Page 1 - RECEIVER'S REQUEST FOR APPROVAL OF TWENTYFOURTH INTERIM FEE APPLICATION 

SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

Troy Greenfield, OSB #892534 

Email: tgreenfield@schwabe.com 

Lawrence R. Ream (Admitted Pro Hac Vice) 

Email: lream@schwabe.com 

SCHWABE, WILLIAMSON & WYATT, P.C. 

1211 SW Fifth Avenue, Suite 1900 

Portland, OR 97204 

Telephone: 503-222-9981 

Facsimile: 503-796-2900 

Attorneys for Receiver for Defendants 

AEQUITAS MANAGEMENT, LLC; AEQUITAS HOLDINGS, LLC; 

AEQUITAS COMMERCIAL FINANCE, LLC; AEQUITAS 

CAPITAL MANAGEMENT, INC.; AEQUITAS INVESTMENT 

MANAGEMENT, LLC 

IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF OREGON 

PORTLAND DIVISION 

SECURITIES AND EXCHANGE 

COMMISSION, 

Plaintiff, 

v. 

AEQUITAS MANAGEMENT, LLC; 

AEQUITAS HOLDINGS, LLC; 

AEQUITAS COMMERCIAL FINANCE, 

LLC; AEQUITAS CAPITAL 

MANAGEMENT, INC.; AEQUITAS 

INVESTMENT MANAGEMENT, LLC; 

ROBERT J. JESENIK; BRIAN A. OLIVER; 

and N. SCOTT GILLIS, 

Defendants.

 No. 3:16-Cv-00438-JR

RECEIVER'S REQUEST FOR APPROVAL 

OF TWENTY-FOURTH INTERIM FEE 

APPLICATION 

 

Case 3:16-cv-00438-JR Document 992 Filed 07/07/22 Page 1 of 41
Page 2 - RECEIVER'S REQUEST FOR APPROVAL OF TWENTYFOURTH INTERIM FEE APPLICATION 

SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

LOCAL RULE 7-1 

Owing to the complexity and volume of the Receiver’s Request for Approval of TwentyFourth Interim Fee Application, the Receiver has not sought to confer with the other parties or 

counsel as would normally be required under Local Rule 7-1. In accordance with the direction 

set forth in the Order Appointing Receiver, the Receiver provided the Securities and Exchange 

Commission (the “Commission”) complete copies of the detailed invoices of all of the firms 

prior to the filing of this Application and received no objection from the Commission. 

I. RELIEF REQUESTED 

The Court-Appointed Receiver in this action, Ronald F. Greenspan, respectfully requests 

the Court’s approval to pay the interim fees and expenses of the Receiver and the professional 

service firms that have rendered services on behalf of the Receivership Entity for the period from 

January 1, 2022 through March 31, 2022 (the “Twenty-Fourth Application Period”). 

The efforts of the Receiver and the professionals on behalf of the Receivership Entity are 

set forth in detail in the March 31, 2022 Report of the Receiver (the “March 2022 Report”)1 as 

well as in the summary invoice of each professional, which are attached to the Declaration of 

Ronald F. Greenspan (the “Greenspan Declaration”) filed contemporaneously with this motion.2

As the Court is aware, this is a very complex and otherwise difficult case. The information 

contained in the March 2022 Report and in the summary invoices demonstrates both the necessity 

of the services provided, as well as the reasonableness of the resulting fees and expenses. 

The Court has previously approved the engagement of each of the professional service 

 

1

 Dkt. 979. 

2

 Greenspan Declaration, Exhibits B through D.

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Page 3 - RECEIVER'S REQUEST FOR APPROVAL OF TWENTYFOURTH INTERIM FEE APPLICATION 

SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

firms. In accordance with the request of the Commission, all of the firms have discounted their 

standard hourly rates. The fees and expenses submitted to the Court for approval are consistent 

with the Billing Instructions for Receivers in Civil Actions Commenced by the U.S. Securities 

and Exchange Commission (the “Billing Instructions”). In accordance with the direction set forth 

in the Order Appointing Receiver, the Receiver provided the Commission complete copies of the 

detailed invoices of all of the firms prior to the filing of this Application and the Commission 

does not object to the Application. Prior fees and expenses requested, allowed, and paid by the 

Receivership Entity are set forth in detail below. 

II. BACKGROUND 

On March 10, 2016, the Commission filed a Complaint (the “Complaint”) against the 

Entity Defendants as well as Robert J. Jesenik, Brian A. Oliver and N. Scott Gillis (collectively 

the “Individual Defendants”), for alleged violation of Federal Securities Laws in what the 

Commission describes as a “Ponzi-like” scheme [Dkt. 1]. The Commission alleges that the 

Individual Defendants, all principals of one or more of the Entity Defendants, defrauded 

investors and also misused investor funds to pay operating expenses and to repay earlier 

investors.3 The Commission further alleges that “[b]y the end of 2015 [Aequitas] owed investors 

$312 million and had virtually no operating income to repay them.”4 The investments identified 

by the Commission refer to the funds borrowed by ACF, one of the 48 entities composing the 

 

3

 Dkt. 1, ¶¶ 1-7. Of note, one of the Individual Defendants, Brian Oliver, has pleaded guilty to 

conspiracy to commit mail and wire fraud in violation of 18 U.S.C. § 1349 and conspiracy to 

commit money laundering in violation of 18 U.S.C. § l 956(h). Additionally, the former CFO 

Olaf Janke has also pleaded guilty to the same charges. Four additional former directors and 

officers have also been indicted. 

4

 Dkt. 1, ¶ 5. 

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SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

Receivership Entity. In total, there are over $600 million of investor funds in the Receivership 

Entity. 

On March 16, 2016, pursuant to the Stipulated Interim Order Appointing Receiver, 

Ronald F. Greenspan was appointed as Receiver for the Entity Defendants and 43 related entities 

on an interim basis (the “Interim Order”). On April 14, 2016, pursuant to the Order Appointing 

Receiver, Mr. Greenspan was appointed as Receiver for the Receivership Entity on a final basis 

(the “Final Receivership Order”).5

 In very general terms, the Receiver is directed to marshal and

preserve assets of the Receivership Entity. 

The Receiver filed a voluntary report and recommendations to the Court (the “Initial 

Report”) for the first “stub quarter” ending June 30, 2016 [Dkt. 246], the first mandated quarterly 

report covering the period through September 30, 2016 [Dkt. 298] and subsequent reports 

covering the period through December 31, 2016 [Dkt. 365], through March 31, 2017 [Dkt. 444], 

through June 30, 2017 [Dkt. 491], through September 30, 2017 [Dkt. 559], through December 

31, 2017 [Dkt. 587], through March 31, 2018 [Dkt. 610], through June 30, 2018 [Dkt. 644], 

through September 30, 2018 [Dkt. 662], through December 31, 2018 [Dkt. 674], through March 

31, 2019 [Dkt 700], through June 30, 2019 [Dkt. 749], September 30, 2019 [Dkt. 776], through 

December 31, 2019 [Dkt. 793], through March 31, 2020 [Dkt. 826], through June 30, 2020 [Dkt. 

843], through September 30, 2020 [Dkt. 860], through December 31, 2020 [Dkt. 872], March 31, 

2021 [Dkt. 885], through June 30, 2021 [Dkt. 903], through September 30, 2021 [Dkt. 915], and 

through December 31, 2021 [Dkt. 922], which are collectively referred to herein as the 

 

5

 Dkt. 156. 

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Page 5 - RECEIVER'S REQUEST FOR APPROVAL OF TWENTYFOURTH INTERIM FEE APPLICATION 

SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

“Receiver’s Reports.” The March 2022 Report [Dkt. 979] is the Receiver’s report and 

recommendations to the Court for the quarter ending March 31, 2022. The contents of the 

Twenty-Fourth Interim Fee Application, like the focus of the March 2022 Report, provides the 

basis for the fees and expenses incurred by the professionals on behalf of the Receivership for 

the quarter ending March 31, 2022. 

A. The Receiver has continued to successfully preserve and monetize 

Receivership assets, as well as implement the claims process and the 

distributions of Receivership assets. 

The Receiver has successfully stabilized the Receivership Entity, preserved value when 

possible and facilitated the monetization of a majority of the Receivership assets, obtained 

approval of the Distribution Plan and completed three, Court-approved interim distributions of a 

majority of the Receivership assets. Through the quarter ended March 31, 2022, the Receiver has 

sold Receivership Entity gross assets and collected receivables totaling approximately $325 

million, plus an additional $32 million of gross assets owned by CPFIT (an affiliate of the 

Receivership Entity but excluded from the Receivership itself), has collected proceeds from 

litigation and settlements totaling approximately $19 million, and has negotiated claims 

reductions exceeding $95 million as part of approved settlement agreements. 

The Receiver has also entered into and substantially completed the implementation of a 

settlement with the Consumer Financial Protection Bureau (“CFPB”) and fourteen state 

Attorneys General in connection with the Corinthian Colleges student loan portfolio held by 

Campus Student Funding, LLC, including modification or cancellation of each of the 

approximately 47,000 loans, and appropriate notification to each of the borrowers. 

As previously discussed, on March 10, 2016, the SEC filed a complaint in this Court 

alleging that certain Aequitas executives and five entities had violated various federal securities 

Case 3:16-cv-00438-JR Document 992 Filed 07/07/22 Page 5 of 41
Page 6 - RECEIVER'S REQUEST FOR APPROVAL OF TWENTYFOURTH INTERIM FEE APPLICATION 

SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

laws. On June 6, 2016, the SEC and the Receiver, acting on behalf of the Aequitas Entity 

Defendants, filed a consent judgment with the Court, which resolved the claims set forth in the 

SEC Complaint against the Entity Defendants only, without admitting or denying the numerous 

allegations. A final judgement in this case as to Aequitas Management, LLC; Aequitas Holdings, 

LLC; Aequitas Commercial Finance, LLC; Aequitas Capital Management, Inc; and Aequitas 

Investment Management, LLC was entered by the Court on April 13, 2020 [Dkt. 822]. Summary 

information related to this judgment and final judgments on consent against the three top 

executives can be found at https://www.sec.gov/litigation/litreleases/2020/lr24805.htm. 

As mandated by the Final Receivership Order, the Receiver conducted his forensic 

investigation and the resulting forensic report (the “Forensic Report”) was filed with the Court 

on November 21, 2018 [Dkt. 663]. 

On April 25, 2019, the Court entered the Order (1) Establishing Claims Bar Date, (2) 

Approving The Form And Manner Of Notice, And (3) Approving The Proof Of Claim Form, 

Procedures And Other Related Relief (the “Claims Procedures Order”). 

The Receiver then proceeded expeditiously to implement the claims process as mandated 

in the Claims Procedures Order. As of March 31, 2022, 341 claims had been received and 4,830 

Notices of Receiver’s Initial Determination had been issued.6

 The Receiver has adjudicated the 

vast majority of the claims that were filed against the Receivership Estate and is actively 

pursuing resolution of a handful of remaining claims. 

 

6

 Certain claims agree with the Notice of Receiver’s Initial Determination, and a number of filed 

claims are duplicative. Therefore, the number of actual claims is less than the sum of the filed 

claims and NODs issued. 

Case 3:16-cv-00438-JR Document 992 Filed 07/07/22 Page 6 of 41
Page 7 - RECEIVER'S REQUEST FOR APPROVAL OF TWENTYFOURTH INTERIM FEE APPLICATION 

SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

On December 23, 2019, with the goal of mitigating certain potential tax consequences 

and maximizing the future distributions on the Allowed Claims, the Receiver filed his motion 

and the Court entered the Order to Authorize, Approve, and Take Continuing Jurisdiction Over a 

Qualified Settlement Fund (“QSF”), and For Related Relief [Dkt. 781]. Subsequently, on 

December 31, 2019, the Receiver filed his Motion for Order (1) Approving Form And Manner 

Of Notice Regarding Approval Of Proposed Distribution Plan And Ponzi Determination, (2) 

Approving Procedures And Deadlines, (3) Setting A Hearing, And For Related Relief [Dkt. 785], 

which was approved by the Court on January 14, 2020 [Dkt. 790]. 

Also on December 31, 2019, the Receiver filed his Motion to Approve the Receiver’s 

Distribution Plan And Determination Of A Ponzi Scheme [Dkt. 787]. The Court held a 

telephonic hearing on this Motion on March 31, 2020 and, following no objections raised at the 

hearing or otherwise remaining unresolved, the Court entered Findings of Fact and Conclusions 

of Law, approving the Receiver’s Distribution/Ponzi Determination Motion, as expressly 

modified by the Receiver [Dkt. 813]. 

In the first half of 2020, the Receivership staff and the retained professionals 

expeditiously managed a distribution plan noticing campaign based on the form and manner of 

notice that had been approved by the Court. At least 4,796 notices were sent to the parties that 

were required to be noticed by the Court and relevant information was posted on the 

Receivership website. 

On May 15, 2020, the Receiver’s Motion to Approve Classification, Allowance of the 

Amount of Claims for Certain Claimants (Administrative Claims, Convenience Class Claims, 

and Former-Employment Claims), and Approving Distributions to those Claimants [Dkt. 835] 

and the related pleadings were filed with the Court. The Motion was unopposed and was 

Case 3:16-cv-00438-JR Document 992 Filed 07/07/22 Page 7 of 41
Page 8 - RECEIVER'S REQUEST FOR APPROVAL OF TWENTYFOURTH INTERIM FEE APPLICATION 

SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

approved by the Court on June 1, 2020 [Dkt. 838]. Following Court approval in June of 2020, 

the Receivership staff and retained professionals completed the first distribution in the amount of 

$973,797. 

On October 21, 2020, the Receiver's (Second) Motion to Approve Classification of 

Certain Claims (Administrative, Former-Employees, Convenience Class, Defrauded Investors, 

Creditors, Individual Defendants, and Pass-Through Investors), and Allow and Approve 

Distributions on Account of Certain Claims (“Second Distribution Motion”) and related 

pleadings were filed with the Court. [Dkt. Nos. 848-850]. This Motion addressed 2,056 claims 

across seven different claim classes. The Second Distribution Motion was approved by the Court 

on November 10, 2020 [Dkt. 861]. The Second Distribution was substantially completed by the 

end of 2020, with approximately $73.5 million going to Defrauded Investors. 

In the first quarter of 2021, the Receivership staff and the retained professionals focused 

on the various tasks of completing the Second Distribution, including but not limited to extensive 

communication with the Investors and their representatives, addressing Investor inquiries, reissuing distributions on a case-by-case basis under special circumstances, and preparing for and 

implementing required tax reporting related to the Second Distribution. 

During the second quarter of 2021, the Receivership staff and the retained professionals 

prepared for the next (third) interim distribution and resolution of the remaining claims. On July 

16, 2021, distribution notices were mailed to 1,674 parties and relevant information, including 

answers to an exhaustive set of FAQs was posted on the Receivership website. On July 19, 2021, 

the Receiver filed a Third Motion to Approve Classification of Certain Claims (Administrative, 

Convenience Class, Creditors, and Defrauded Investors), Allow and Approve Distributions on 

Account of Certain Claims, and Approving Distributions to Claimants Who Elect 

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Page 9 - RECEIVER'S REQUEST FOR APPROVAL OF TWENTYFOURTH INTERIM FEE APPLICATION 

SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

Reclassification To Convenience Class Status (the “Third Distribution Motion”), by which the 

Receiver proposed to distribute approximately $22 million to several classes of claimants. The 

Third Distribution Motion was approved by the Court on August 5, 2021. The Receiver 

completed the third interim distribution in the fourth quarter of 2021. 

From the outset of the Receivership and through this Application Period, the Receiver 

and his team have expended considerable time and effort to orchestrate successful resolution of 

investors’ claims against the professional firms that served the various Aequitas entities such as 

Tonkon Torp, Integrity Bank & Trust, Deloitte & Touche, EisnerAmper, Sidley Austin, Duff & 

Phelps, and TD Ameritrade (“Professional Firm Defendants”). 

In particular, development of the Receivership Entity’s consolidated database, 

preparation of the Forensic Report and facilitation of multiple large-scale, multi-day 

mediation sessions paved the way for the following: 

 Payments from the Professional Firm Defendants to the class 

totaling $234,613,000, as well as multiple additional seven- and 

eight-figure payments to other plaintiff groups presently subject to 

confidentiality agreements; 

 Releases of contribution and other claims of the Professional Firm 

Defendants against the Receivership Entity, including the release 

of $50 million contribution claim presented by Deloitte; and 

 Contingent releases of contribution and other claims of the 

Professional Firm Defendants against the Individual Defendants,

Advisory Board members and other former officers and directors.

The original releases were contingent upon those parties releasing 

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Page 10 - RECEIVER'S REQUEST FOR APPROVAL OF TWENTYFOURTH INTERIM FEE APPLICATION 

SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

claims to the proceeds of the insurance policies maintained by 

entities comprising the Receivership Entity. 

The efforts of the Receiver to facilitate resolution of investor claims against the 

Professional Firm Defendants have greatly accelerated anticipated distributions to the 

investors, both direct distributions of the settlement proceeds and ultimately distributions 

from the Receivership estate and will meaningfully reduce the cost of administering the 

Receivership. 

On October 22, 2020, the Receiver filed a Motion for Order (1) Approving 

Compromises of Claims, (2) Approving and Authorizing Performance of Settlement 

Agreements, (3) Entering Claims Bars, and (4) Removing a Receivership Entity and an 

Extended Entity (“Motion to Approve Settlements”) and related pleadings [Dkt. Nos. 852 

– 855] encompassing 36 settlements. Amongst other requested relief, the Receiver 

sought approval of the settlement agreement resolving all claims presented in the 

consolidated insurance coverage action other than those of the Receiver against Catlin. 

Judge Jolie A. Russo granted the Receiver’s Motion to Approve Settlements on 

November 10, 2020, by way of Findings, Recommendations and Order [Dkt. 862], that 

were simultaneously referred to Judge Marco A. Hernandez for review [Dkt.863]. On 

December 11, 2020, Judge Hernandez issued an Order adopting Judge Russo’s Findings 

and Recommendation and granted the Receiver’s Motion to Approve Settlements [Dkt. 

866] and entered the Amended Limited Judgment As To The Professional Firms And The 

Terrell Parties, including Permanent Injunctions [Dkt. 876]. 

On April 16, 2021, the Receiver filed a Motion for Order Approving 

Compromises of Claims and Authorizing Performance of Settlement Agreements 

Case 3:16-cv-00438-JR Document 992 Filed 07/07/22 Page 10 of 41
Page 11 - RECEIVER'S REQUEST FOR APPROVAL OF TWENTYFOURTH INTERIM FEE APPLICATION 

SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

(“Second Motion to Approve Settlements”) and related pleadings [Dkt. Nos. 881-883] 

involving 47 additional settlements. On May 6, 2021, the Court entered an order granting 

the Receiver’s Second Motion to Approve Settlements. [Dkt. No. 886]. 

On July 7, 2021, the Receiver filed another Motion for Order Approving 

Compromises of Claims and Authorizing Performance of Settlement Agreements (“Third 

Motion to Approve Settlements”) and related pleadings [Dkt. Nos. 889-891], that was 

granted by the Court on July 26, 2021 [Dkt. No. 898]. 

On October 27, 2021, the Receiver filed another Motion for Order Approving 

Compromises of Claims and Authorizing Performance of Settlement Agreements 

(“Fourth Motion to Approve Settlements”) and related pleadings [Dkt. Nos. 912-914], 

seeking the Court’s approval of 25 additional settlement agreements that collectively 

result in payments to the Receivership Estate totaling $1,207,892.90. On November 23, 

2021, the Court entered an order granting the Receiver’s Fourth Motion to Approve 

Settlements [Dkt. No. 916]. 

During this Application Period, on March 24, 2022, the Receiver filed another 

Motion for Order Approving Compromises of Claims and Authorizing Performance of 

Settlement Agreements (“Fifth Motion to Approve Settlements”) and related pleading 

[Dkt. Nos. 961-963], seeking the Court’s approval of 16 additional settlement agreements 

that collectively result in payments to the Receivership Estate totaling $1,111,798.00. On 

April 12, 2022, the Court entered an order granting the Receiver’s Fifth Motion to 

Approve Settlements [Dkt. No. 974]. 

The settlements addressed in the Receiver’s First, Second, Third, Fourth, and 

Fifth Motions to Approve Settlements resulted in over $22.3 million in direct monetary 

Case 3:16-cv-00438-JR Document 992 Filed 07/07/22 Page 11 of 41
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SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

benefits to the Receivership Estate. Additionally, these settlements have eliminated tens 

of millions of dollars of claims against the Receivership Estate, materially increasing the 

recovery on the allowed claims of the Defrauded Investors and others. 

During this Application Period, the Receiver and Receivership professionals 

worked on the resolution of the claims filed by American Student Financial Group, Inc. 

and TRD Consulting, LLC, as discussed in more detail further in the Application. 

The Receiver and his retained professionals continue to actively pursue recoveries 

on the remaining claims that the Receivership holds against various parties, including but 

not limited to a very limited number of non-settling net winners and other parties who 

received transfers of value from Aequitas during the Ponzi period. The Receiver’s goal is 

to conclude these recovery efforts during 2022, although this timetable will necessarily 

depend upon the posture of the adverse parties and the Court’s calendar. 

During the subject reporting period, the Receiver and his remaining retained 

professionals continue to work on various aspects of the gradual operational wind down, despite 

the challenges presented by the COVID-19 pandemic. Earlier in the year, significant changes to 

the IT infrastructure were finalized, including completing transition to an off-site data center and 

strengthening the infrastructure security by implementing a two-factor authentication process. 

The office utilized by the Receivership staff was relocated at the end of the first quarter of 2021, 

with the footprint and rental cost significantly reduced. The Receiver has obtained flexible 

termination provisions in the Receivership’s current office and is able to vacate the premises and 

terminate the lease when the space is no longer needed or the Receivership winds up. 

During the Application Period, the Receivership staff and retained professionals 

expended significant effort planning the next phase of the IT footprint and spend reduction, 

Case 3:16-cv-00438-JR Document 992 Filed 07/07/22 Page 12 of 41
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SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

including transitioning to a 100% cloud-based solution. The Receivership staff and retained 

professionals completed the evaluation of the Receivership infrastructure and data assets and 

secured a favorable contract with a cloud service provider for the cloud-based transition and 

infrastructure hosting. As of the date of this Application, the implementation of the transition to 

the cloud-based infrastructure is essentially completed. The Receiver’s focus in this process 

remains on ensuring that appropriate systems are in place to efficiently support the 

Receivership’s ongoing operations through the wind-down and to preserve information that may 

be relevant to ongoing litigation. 

The Receivership continued to facilitate discovery, with 297 parties accessing the 

database, which contains 17.5 million documents, through March 31, 2022, and provide financial 

and tax administration including preparing numerous Receivership Entity tax returns. 

B. The Receiver continues to manage the Receivership Entity and 

recommends that the Receivership continue for the benefit of 

investors and creditors. 

It remains the Receiver’s recommendation that the Receivership be continued. A number 

of the conditions under which the Receivership was imposed still exist. While we are in the 

homestretch, several crucial steps remain before the Receiver can reasonably seek an order 

terminating the Receivership. The Receiver must finish monetizing the remaining assets in a 

manner and on a timeline consistent with reasonably maximizing the value to stakeholders. The 

Receiver also must (i) complete the claims processes, (ii) complete necessary litigation, (iii) 

manage any remaining distributions, and (iv) wind down the estate. 

Although the consumer loan portfolios have been immensely reduced, the remaining 

loans owned by the Receivership require management until they are monetized or otherwise 

resolved. The Receiver and his team fill the management gap left after the termination of the 

Case 3:16-cv-00438-JR Document 992 Filed 07/07/22 Page 13 of 41
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SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

Individual Defendants and the departures of other management and staff (more than 95% of preReceivership employees are no longer with the companies comprising the Receivership Entity). 

Absent that day-to-day, hands-on management, risks would significantly increase and the 

Receivership Entity’s, and, ultimately, the investors’ value would be diminished. . 

Feedback from Commission staff and Aequitas investors regarding our progress thus far 

has been positive. The Receiver is very mindful of the priorities to proceed both expeditiously 

and economically, to make interim distributions whenever possible, and conclude this 

Receivership in an equitable fashion as soon as practicable. The Receiver believes he has the 

constituent’s support and encouragement to continue his efforts, and that they also support the 

continuation of the Receivership. 

C. The following qualified professional service firms have been engaged 

by the Receiver to aid in the discharge of his duties and 

responsibilities to the Receivership Entity. 

On March 16, 2016, pursuant to the Interim Order, the Receiver engaged FTI Consulting, 

Inc. (“FTI”), as well as the law firms of Pepper Hamilton LLP (“Pepper”), Schwabe, Williamson 

& Wyatt PC (“Schwabe”) and Pachulski Stang Ziehl & Jones LLP (“Pachulski”) on an interim 

basis. On April 14, 2016, pursuant to the Final Receivership Order, the Receiver engaged FTI, 

Pepper, Schwabe and Pachulski on behalf of the Receivership Entity. 

On July 18, 2016, pursuant to the Order Granting Receiver’s Application To Employ 

Counsel, the Receiver employed the Law Offices of Stanley H. Shure (“Shure”), Akin Gump 

Strauss Hauer & Feld LLP (“Akin”), Morrison & Foerster LLP (“MoFo”) and Ater Wynne LLP 

(“Ater”) nunc pro tunc to March 10, 2016. 

On May 3, 2018, pursuant to the Order Granting Receiver’s Application to Employ 

Counsel, the Receiver employed Snell & Wilmer LLP (“Snell & Wilmer”) in order to retain 

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SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

attorney, Ivan B. Knauer, who relocated from Pepper Hamilton to Snell & Wilmer. 

On June 10, 2019, pursuant to the Order Granting Receiver’s Application to Employ 

Counsel, the Receiver employed Parsons, Farnell & Grein, LLP (“Parsons Farnell) as local 

insurance counsel for the Receiver. 

1. FTI Consulting - Receiver, Financial Advisor and On-Site 

Management 

The Receiver is employed as a Senior Managing Director of FTI, which bills and collects 

for the Receiver’s time and expenses. To support the Receivership, the Receiver has retained FTI 

and has access to FTI professionals. FTI is serving as financial advisor to the Receiver and 

providing on-site and remote (given the current restraints imposed by the Covid-19 pandemic) 

management supervision over the operations of the Receivership Entity. Additionally, FTI has 

been instrumental in preparing assets for market, running certain sale processes, data and 

information consolidation, investor account data verification, coordinating and overseeing the 

forensic accounting, implementation of the national Corinthian Colleges student note receivable 

settlement with the CFPB and fourteen state Attorneys General, planning and implementation of 

the claims process, distribution plan development and implementation, and the wind down of the 

estate. 

2. Pepper Hamilton - Securities and Exchange Commission 

Counsel 

Pepper was retained by the Receiver in connection with SEC-related matters, including 

the SEC Complaint and discovery promulgated thereunder. Pepper has also acted as a point of 

contact for the Receiver with the Consumer Financial Protection Bureau (the “CFPB”) and 

certain other governmental agencies. Pepper has also assisted the Receiver with certain 

transactional work. 

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SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

3. Snell & Wilmer - Securities and Exchange Commission 

Counsel 

Following the move of attorney Ivan Knauer from Pepper to Snell & Wilmer around May 

1, 2018, Snell & Wilmer represented the Receiver in connection with SEC-related matters, 

including the SEC Complaint and discovery promulgated thereunder. Snell & Wilmer also 

represented the Receiver regarding other regulatory inquiries and acted as a point of contact for 

the Receiver with the state Attorneys General, Consumer Financial Protection Bureau (the 

“CFPB”) and certain other governmental agencies. Counsel was diligently ensuring there was no 

duplication in work performed by Pepper and Snell & Wilmer. 

4. Schwabe, Williamson & Wyatt – General Counsel 

As general counsel to the Receiver, Schwabe provides general outside counsel advice, as 

well as the majority of transactional and litigation support for all matters other than the SEC 

action. As periodically requested by the Receiver and as required of local counsel, Schwabe 

assists in the SEC enforcement action. Schwabe also communicates with the Commission Staff 

regarding operations, asset sales and other issues related to the administration of the 

Receivership. 

5. Pachulski Stang Ziehl & Jones – Bankruptcy Counsel 

Pachulski has been retained to provide advice involving bankruptcy related matters, if 

needed. Pachulski also advised the Receiver at outset of the case on various receivership set up 

and administration matters and performed lien perfection analyses. 

6. Stanley H. Shure – Insurance Counsel 

The Law Offices of Stanley H. Shure was retained to provide counsel on all insurance 

coverage issues pertaining to the Receivership Entity, including but not limited to: (a) reviewing 

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SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

and analyzing the Receivership Entity’s liability insurance policies with respect to the claims 

made against it, (b) providing counsel in the event of insurance coverage disputes with the 

Receivership Entity’s insurers, (c) evaluating the “Bankers Bond” policy for scope of coverage 

and whether the Receivership Entity holds any claims under the policy, and (d) analyzing and 

providing counsel with respect to claims, if any, that the Receivership Entity may have against 

former directors and officers of the Receivership Entity. 

7. Morrison & Foerster – Consumer Financial Protection Bureau 

Before the Commission filed suit, MoFo was counsel for three entities within the 

Receivership Entity: Aequitas Capital Management, Inc., Aequitas Commercial Finance, LLC, 

and Campus Student Funding, LLC on two matters. Specifically, MoFo represented those three 

entities with respect to (a) the Corinthian Colleges’ bankruptcy case, and (b) an investigation 

initiated by the CFPB and certain state attorneys general relating to Corinthian-related student 

loans owned by Campus Student Funding (the “CFPB Matter”). The Receiver has retained MoFo 

with respect to ongoing representation in the CFPB Matter only and assistance with various 

consumer finance matters. 

8. Akin Gump Strauss Hauer & Feld – American Student Financial 

Group, Inc. 

Prior to entry of the Interim Order, Akin was counsel to certain entities within the 

Receivership Entity in two matters. First, Akin represented Aequitas Capital Management, Inc. 

in the matter of American Student Financial Group, Inc., et al. v. Aequitas Capital Management, 

Inc., Case No. 12-cv-02445-CAB-JMA (S.D. Cal.). Akin also represented Robert Jesenik and 

Andrew MacRitchie in that action but claims against those individuals were dismissed on 

summary judgment. Second, Akin has represented the following companies in the Receivership 

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SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

Entity, in the matter of American Student Financial Group, Inc. v. Campus Student Funding, 

LLC, et al., Case No. 37-2013-00028562-CU-IP-CTL (San Diego Superior Court): Aequitas 

Commercial Finance, LLC; Aequitas Investment Management, LLC; Aequitas Income 

Protection Fund, LLC; Aequitas Income Opportunity Fund, LLC; and Aequitas Capital 

Management, Inc. Akin has also represented Campus Student Funding, LLC, f/k/a ASFG, LLC, 

Thomas Szabo, and Thomas Reiter in the same matter. 

9. Parsons Farnell & Grein, LLP-Local Counsel for Insurance 

matters 

Parsons Farnell is special co-counsel serving as local insurance recovery counsel for the 

Receiver in connection with claims implicating directors and officers insurance coverage issued 

to one or more of the entities comprising the Receivership Entity. 

10. Ater Wynne – Conflicts Counsel regarding Wells Fargo Bank, 

NA 

Ater was retained to represent the Receiver with respect to matters adverse to Wells 

Fargo Bank and other matters where the Receiver’s retained counsel had a conflict of interest. 

The Wells Fargo liability has been retired. Ater withdrew as counsel to the Receiver effective 

April 4, 2017 [Dkt. 396]. 

D. The Receiver and the professional firms have already returned 

millions of dollars to the Receivership Entity. 

Following the significant distributions made in 2020 and 2021 and collections resulting 

from a number of settlements, the Receiver had cash balances of approximately $25 million as of 

March 31, 2022 for the entities included in the Receivership Entity. The Standardized Fund 

Accounting Report, which is included in the Receiver’s March 2022 Report, provides a detailed 

statement of cash receipts and disbursements through March 31, 2022. The following are brief 

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SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

summaries of some of the ongoing asset monetization and sales efforts undertaken or impacted 

during the Twenty-Fourth Application Period. 

1. Campus Student Funding 

On August 17, 2017, the Court approved Receiver entering into the nationwide 

settlement with Consumer Financial Protection Bureau (CFPB) and thirteen state 

Attorneys General in connection with the Corinthian Colleges private student loan 

portfolio owned by the Receivership (the “Settlement”) [Dkt. 495]. Subsequently, on 

June 12, 2018, the Court approved the Receiver’s Motion for Approval of Proposed 

Settlement with Massachusetts Attorney General. [Dkt. 620]. The Massachusetts 

Settlement, implemented in the form of an Assurance of Discontinuance, became 

effective on June 21, 2018. 

Following the very significant effort expended by the Receivership on the 

implementation of the Settlement at the end of 2017 and in the beginning of 2018, which 

resulted in processing relief in connection with approximately 47,000 loans, the Receiver 

continued to implement the remaining obligations under the Settlement in 2018. 

Subsequently, the Receivership Staff and retained professionals continued to work with 

the regulators to address any questions that came up in the course of the operations of the 

portfolio. 

Additionally, the Receivership continued to maintain a detailed informational 

website for the borrowers in connection with the Settlement. Most of the borrower 

inquiries are being addressed by the servicer but the Receivership also addressed 1,920 

borrower inquiries directly (through March 31, 2022). In addition to addressing direct 

borrower inquiries, the Receivership staff and retained professionals monitor, review, and 

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SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

respond to borrower complaints that are submitted through the CFPB on-line consumer 

complaint portal or through other venues. All these activities are instrumental in 

mitigating the Settlement implementation risk to the Receivership, reducing the number 

of potential borrower complaints, and stabilizing the portfolio. 

To handle potential borrower inquiries related to the 1099 tax forms, the 

Receivership has set up an outsourced call center that handled 2,446 calls, including 

1,077 calls answered by agents, through March 31, 2022 (the rest of the callers chose to 

only listen to a detailed recorded message). The Receivership staff and retained 

professionals worked closely with the call center vendor to review call logs and monitor 

the performance to make sure that the borrowers receive appropriate information. 

In the reporting period, the Receivership team continued to work closely with the loan 

servicer and help address borrower inquiries. The Receiver is continuing to monitor the portfolio 

performance and evaluate the next steps in connection with the monetization and the wind down 

of the remaining portfolio. 

2. MotoLease Financial (MLF) 

MLF holds subprime consumer leases for motorcycle and other recreational 

vehicles. Through March 31, 2022, the Receiver has collected approximately $16.1 

million on account of the leases owned at the beginning of the Receivership. During this 

Application Period, the Receivership staff and retained professionals expended 

significant effort planning and implementing the wind down of the portfolio, including 

exploring opportunities to monetize the remnant assets. As part of the portfolio wind 

down process, on June 21, 2022, the Receiver filed a Motion to Abandon All Right, Title, 

And Interest in Certain Tangible Personal Property Of Motolease Financial, LLC [Dkt. 

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SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

985], which motion is currently pending in front of the Court. 

3. Portland Seed Fund (PSF) 

Portland Seed Fund is an investment in a local venture capital fund providing 

early-stage capital to Oregon based start-ups. Proceeds from two recent monetization's of 

investments by the Fund were distributed to PSF members, including the Receivership, in 

June and August of 2021. The cumulative distributions from PSF are now greater than 

the contributions, and additional distributions are expected in the second and third 

quarters of 2022. 

The Receiver and his professionals have continued exploring opportunities to monetize 

the remaining PSF interest in the context of the PSF anticipated future wind down. At this time, 

the Receiver intends to hold this asset until further notice. 

E. Ongoing Litigation 

As addressed in prior reports and reflected in the previously disclosed settlements, the 

Receiver continues his frequent engagement in negotiations with a number of parties to recover 

Receivership assets and/or to resolve substantial, disputed claims. Consistent with the Court’s 

prior and any subsequent orders, to the extent negotiated resolutions are not reached with any of 

the parties, the Receiver will file additional actions. 

1. Newman 

The Court granted summary judgment in favor of the Receiver on claims for breach of a 

promissory note. Together with attorney fees, the judgment against the defendants, Robert 

Jesenik’s relatives, totaled $462,754.68 plus interest. The Receiver necessarily initiated judgment 

debtor proceedings. In light of the defendants’ financial circumstances, the Receiver negotiated a 

compromise resolution. The Court recently approved the settlement [Dkt. No. 974] and the 

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SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

defendants paid $334,000 to the Receivership Estate. 

2. Net Winners 

With the benefit of the Court’s determination that the consolidated Aequitas enterprise 

was operated as a Ponzi scheme at least as early as July 1, 2014 [Dkt. 813], the Receiver and his 

team gathered and analyzed data to identify “net winners” (investors who received funds in 

excess of their initial investments prior to initiation of the Receivership) and determine the 

amount of their net winnings. The Receiver then provided individual net winners a summary of 

their account activity as well as a pre-litigation offer of settlement. The majority of the net 

winners accepted the Receiver’s offer and made the corresponding repayment to the 

Receivership Estate. Those net winner settlement agreements were addressed in the Receiver’s 

First, Second, and Third Motions to Approve Settlements. 

In accordance with the prior orders of the Court, on June 28, 2021, the Receiver filed suit 

against all net winners who did not agree to return their net winnings to the Receivership Estate 

(“Net Winner Defendants”), seeking to recover approximately $2,000,000 plus interest. Since 

filing suit, the Receiver has resolved the Receivership Entity’s claims against 38 of the Net 

Winner Defendants. On November 23, 2021, and on April 12, 2022 (during this Application 

Period), the Court entered orders granting the Receiver’s Fourth and Fifth Motion to Approve 

Settlements, including, respectively, those with 23 and 11 of the Net Winner Defendants. 

The table below summarizes the status of the net winner recoveries as of June 30, 2022. 

Net Winner Settlement Summary (as of 06/30/22) # of Parties Amount 

Cash Received from Net Winners 104 $3,238,428 

Additional Installment Payments Outstanding $540,910 

Distribution Offsets 9 $490,490 

Total 113 $4,269,827 

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SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

The Receiver issued a final settlement offer to the remaining Net Winner Defendants 

and will soon file a motion for entry of summary judgment against the very few who did not 

accept the offer. 

3. Lawsuits Against Recipients of Commissions, Consulting Fees and Advisory 

Fees 

On July 9, 2021, the Receiver filed suit against eleven different parties who received 

transfers from Aequitas during the Ponzi Period that were nominally referred to as commissions, 

consulting fees or advisory fees, seeking to recover approximately $1,210,000 plus interest. The 

Receiver has negotiated settlement agreements with nine of the eleven parties, obligating those 

parties to collectively return $786,000 to the Receivership Estate. 

4. Other 

The Receiver is in the midst of settlement negotiations with additional parties, the 

majority of which are subject to claims for breach of contract and fraudulent conveyance. As 

indicated above, in the event the claims cannot be resolved in the best interests of the 

Receivership Estate, the Receiver will commence litigation in accordance with the prior orders of 

this Court. 

F. The Claims Process 

The Receiver undertook an extensive claim noticing process that included 

notices by publication in 15 major newspaper, issuance and dissemination of a press 

release, and mail and email noticing of over 6,982 parties, including at least 4,830 parties 

who received a Notice of Receiver’s Initial Determination. 

In total, the following number of Notices were sent out: 

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SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

Investor with NOD 2,060 

Other Pre-Receivership Creditor / Vendor with 

NOD 

2,040 

Employee with NOD 84 

Administrative Claimant with NOD 646 

Non-NOD notices (not counted above) 2,152 

Total Notices 6,982 

1. Additional Information Sharing 

Consistent with the requirement of the Claims Procedures Order, the Receiver set 

up a dedicated data sharing site that allowed him to provide copies of notices to the legal 

counsel representing various potential claimants. In some instances, copies of the notices 

were email to legal counsel directly. 

While not required by the Claims Procedures Order, in the spirit of cooperation, the 

Receiver elected to also share copies of the notices received by investors with their Registered 

Investment Advisors (“RIA”) upon receipt of a confirmation of investor’s consent to the 

Receiver’s sharing of such information. 

2. Responding to Claims Process Inquiries 

 Following the mailing of the claims process notices, the Receiver and his staff received 

numerous follow up inquiries from various parties, including potential claimants and their 

representatives. Through March 31, 2022, over 2,364 inquiries in connection with the claims 

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SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

process, distributions, and related tax reporting were addressed directly by the Receivership staff 

and professionals. The Receivership team is continuing to field and respond to inquiries as they 

are received. 

3. Claims Processing and Analysis 

 The Receiver’s professionals and staff have performed the review of the filed 

claims and have submitted three motions to the Court to approve classification and allow 

distributions on certain claims. Through the date of the March 2022 Report, the Court has 

fully or partially adjudicated 4,798 claims. Since the dated of the prior status report and 

during this Application Period, the Receiver has filed four motions to disallow claims and 

one motion to settle a claim, which motions were subsequently approved by the Court. 

Two claims were voluntarily withdrawn by claimants following discussions with 

Receivership professionals. 

As discussed earlier, during this Application Period, the Receiver and 

Receivership professionals worked on the resolution of the claims filed by American 

Student Financial Group, Inc. (“ASFG”) and TRD Consulting, LLC (“TRD”). Prior to the 

filing of the Receivership, ASFG (and its related entity, TRD) filed two lawsuits against 

Aequitas Entities in California. By stipulation, venue was transferred to the Receivership 

Court. Funds that Aequitas had deposited into the California Court registry were also 

transferred to the Receiver and placed in a segregated account. ASFG and TRD jointly 

filed a claim in excess of $27 million in the Receivership and asserted an interest in the 

segregated funds, which the Receiver disputes. Subsequent to filing its proof of claim, 

ASFG changed its name and filed a bankruptcy in Florida. The Receivership was not 

given notice of ASFG’s bankruptcy filing and only subsequently came to learn of the 

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SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

bankruptcy. ASFG’s bankruptcy necessitated extensive analysis, briefing and the filing of 

a motion in the Receivership proceeding to deal with ASFG’s previously unknown 

bankruptcy (the “Bankruptcy Related Motion”). Subsequent to the filing of the 

Bankruptcy Related Motion, the Receiver and ASFG’s Liquidating Trustee conducted 

extensive negotiations, resulting in a compromise and the recent filing of a motion to 

approve the compromise and disbursement of the segregated funds (the” Compromise 

Motion”). TRD objected to the Compromise Motion. The Compromise Motion is now 

under consideration by the Receivership Court. 

Through March 31, 2022: 

 4,857 Notices of Receiver's Initial Determination ("NOD") were mailed or 

emailed out by the Receivership (including 4,830 original NODs and 27 replacement 

NODs). 

 338 individual claim submissions were received by Epiq (the claims 

agent) including: 

o 33 duplicates 

o 3 claims representing amendments of previously filed claims 

o 41 late-filed claims 

 3 claims that were submitted prior to the Bar Date Order and the 

establishment of the claims process. 

Of the 302 non-duplicative individual claims submissions received above, at least 

15 non-duplicative claims did not list any appropriate Aequitas Receivership entities. 

Additionally, 68 of the non-duplicative claims were filed against multiple Aequitas 

Receivership entities. As detailed in the Report of Cash Receipts and Disbursements, 

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SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

attached as Exhibit B to the March 2022 Report, for the purpose of consolidated 

reporting, these claims are counted only once. On the individual entity reports, each 

entity determined on a preliminary basis as being named in the claim form has the claim 

included in its count. 

Based on the initial review by the Receivership staff, the following is a summary 

of non-investor claims filed (or allowed NODs if no claim filed). The Receivership staff 

is continuing to review all submissions to determine the validity of claims. Nothing in the 

summaries should be considered an acceptance or allowance of any claim. 

Non-Investor Claims Count 

NODs Mailed 2,770 

Unique claims filed 89 

Less: Claims filed and NOD sent (20) 

Total Non-Investor Claims 2,839 

Non-Investor Claim Type Count Amount as Filed or Allowed 

Non-Officer Former Employees >$12,850 41 1,438,316 

Non-Officer Former Employees 

<=$12,850 46 384,668 

CarePayment Refund Checks 2,430 183,156 

Campus Student Funding Refund Checks 189 61,614 

Taxes 43 510,261 

Other Claims >$20,000 15 88,704,271 

Other Claims <=$20,000 75 248,897 

Total 2,839 $ 91,531,183 

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SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

Top Ten Non-Investor Claims 

Claimant Name Amount 

Deloitte & Touche LLP7 $ 50,000,000 

ASFG Inc & TRD Consulting LLC 27,381,257 

Norman Gary Price/Strategic Capital Group 5,638,129 

CBL Insurance Ltd 1,994,000 

DELL Financial Services LLC 1,124,865 

Olaf Janke 897,360 

Akin Gump Strauss Hauer & Feld LLP 646,127 

Brian K Rice 438,837 

Salesforce.com Inc. 346,478 

JCPR Inc D/B/A J Connelly 65,998 

Total Top Ten Trade Claims $ 88,533,050 

G. The Receiver and the professional service firms have consistently 

strived to minimize costs. 

As addressed above, in accordance with the request of the Commission, the Receiver and 

all of the professional firms have discounted their standard hourly rates. The Receiver is 

consistently mindful of the professional expenses and manages the work in the most costeffective manner possible. He strives to avoid duplication of effort by the engaged professionals. 

1. Day-to-Day Management 

With the termination of Aequitas management, the Receiver has needed to supervise the 

day-to-day operations of the various Receivership Entities. In addition to the daily management 

duties, the Receiver has focused on several key areas of his mandate, including marshaling, 

preserving and monetizing all assets for the benefit of the investors, as well as managing the 

claims process and distributions on Allowed Claims. 

 

7

 On January 24, 2020, the Receiver executed a settlement agreement with Deloitte regarding 

their contribution claim. 

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SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

The Receiver and his professional team have been working on various aspects of the 

gradual operational wind down, despite the challenges presented by the COVID-19 pandemic. 

The significant changes made to the IT infrastructure during this Application Period, including 

transitioning to an off-site data center and scaling down certain service agreements, have allowed 

to reduce certain IT costs. The office utilized by the Receivership staff was also relocated at the 

end of the first quarter of 2021, with the footprint and rent significantly reduced, resulting in 

annualized rent savings of approximately $202,000, and the Receiver allowed to terminate the 

new lease upon notice to the landlord. As part of the relocation, the Receivership has disposed of 

the remaining surplus office furniture and various equipment. The Receiver is currently 

finalizing further infrastructure reduction, having transitioned to a 100% cloud-based solution as 

discussed earlier. Such transition is expected to provide additional cost savings, reduction in 

infrastructure management requirements, and more flexibility going forward, while allowing the 

Receivership to continue its necessary operations during the wind-down period. 

2. Bank Accounts 

As discussed in the Initial Report, the Receiver has instituted an integrated on-line 

platform that facilitates banking, processing of future distributions, and cash reporting for 

receivership cases. As assets are being monetized, the Receiver has been closing bank accounts 

that are no longer necessary. Following the approval of the QSF by the Court at the end of 2019, 

the Receiver has established separate QSF bank accounts and has consolidated the majority of 

the funds controlled by the Receiver in such account(s). In 2020 and 2021, the Receiver closed 

39 of the legacy Receivership bank accounts that were no longer needed for the ongoing 

operations of the Receivership and the QSF. This helped streamline the Receivership cash 

management operations and facilitate the wind down. As of March 31, 2022, the Receiver 

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SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

maintained 18 bank accounts, consisting of 15 that belong to the Receivership Entity, including 

six attributed to the QSF, and three accounts controlled by the Receiver that are owned by related 

entities. The Receiver continues to gradually close bank accounts that will no longer be needed 

for the Receivership operations. 

The Receiver intends to continue leveraging these existing relationships and systems for 

the implementation of future distribution(s) to the extent feasible. 

Cash basis reports, including information for this Application Period and case to date, are 

attached as Exhibit B to the March 2022 Report.

3. Staffing 

 a. Employee Headcount 

The Receiver continues to maintain the minimum staff necessary for the Receivership 

and enterprise to operate efficiently and effectively. As of March 31, 2022, the Receivership 

Entity had five full-time employees (a reduction by one compared with the prior reporting 

period) and one part-time employee. The Receiver’s employee retention program provides for at 

least six-weeks’ notice to employees whose services are anticipated to no longer be required by 

the Receivership. 

 b. Contractors 

In response to earlier staff attrition in addition to the planned reductions, the Receiver 

necessarily backfilled key accounting and technology positions with local independent 

contractors (not affiliated with FTI). As of March 31, 2022, the Receivership employed two oncall IT contractors, one portfolio management contractor, and one administrative / investor 

relations contractor. 

Case 3:16-cv-00438-JR Document 992 Filed 07/07/22 Page 30 of 41
Page 31 - RECEIVER'S REQUEST FOR APPROVAL OF TWENTYFOURTH INTERIM FEE APPLICATION 

SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

4. Tax Matters 

In the ordinary course of business, the Receivership has many reporting and tax 

preparation responsibilities to investors and taxing authorities. 

a. Tax Preparer 

Since the inception of the Receivership, the Receiver retained a tax specialist to assist 

legacy Aequitas staff in the preparation of tax and information returns, and to provide taxconsulting services on an as-needed basis at the request of the Receiver. During the Application 

Period, Receivership staff and professionals did extensive work to address 2021 Receivership tax 

reporting and tax inquiries. The staff and professionals have also focused on planning for 

potential tax requirements and obligations on closure of the Receivership. 

b. Qualified Settlement Fund and Receivership Entities 2021 Taxation 

As further described in section XI of the March 2022 Report, on motion and by order of 

the Court, substantial assets of the Receivership Entities were transferred to the Aequitas 

Qualified Settlement Fund Irrevocable Trust (“QSF”) along with the obligation to make 

distributions under the Court-approved Distribution Plan. 

2021 Federal and state QSF tax returns were extended by their due date. The returns are 

being prepared and will be filed as soon as they are complete. 

Since the establishment of the QSF, final federal and state tax returns have been filed for 

many of the Receivership Entities. 2021 federal and state returns for the remaining Receivership 

Entities were extended by their due date and will be filed as soon as they are complete. It is 

expected that the QSF will be the final tax filing entity for the Receivership allowing for the 

wind down and final tax filings for all other entities not previously completed. 

Case 3:16-cv-00438-JR Document 992 Filed 07/07/22 Page 31 of 41
Page 32 - RECEIVER'S REQUEST FOR APPROVAL OF TWENTYFOURTH INTERIM FEE APPLICATION 

SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

c. Investor Fund Form K-1s 

Members of Aequitas Holdings LLC and Aequitas Management LLC will be provided 

2021 form K-1s when available. 

d. Distribution Information Reporting and Taxation 

The Receiver finalized the implementation of the third interim distribution in Q4 2021. 

All information reporting that was required in connection with distributions implemented in 2021 

was completed in late January 2022, during this Application Period. 

5. Leveraging the professional firms’ resources 

FTI continues to leverage its access to various resources and services to provide 

information at no additional charge to the Receivership. As a result, the Receivership Entity has 

been able to eliminate contracts with a number of corresponding providers. Additionally, FTI 

provides as-needed tele-conferencing and web-conferencing capabilities to the Receivership 

Entity at no charge. 

Schwabe has in the past provided meeting space and infrastructure at no charge to the 

Receivership Entity, which allowed the Receiver to minimize costs associated with in-person 

meetings. 

6. Discounted Travel Time 

The Receiver, FTI and the majority of legal counsel only charge 50 percent of actual nonworking travel time. Schwabe does not charge for travel time or travel expenses related to travel 

to Portland, Oregon. As a result of the Receivership staff and all professionals working remotely 

during the COVID-19 pandemic, no travel time was incurred during this Application Period. 

7. Out-of-Town Meals and Expenses 

The Receiver carefully monitors the expenses incurred by his professionals. In 

Case 3:16-cv-00438-JR Document 992 Filed 07/07/22 Page 32 of 41
Page 33 - RECEIVER'S REQUEST FOR APPROVAL OF TWENTYFOURTH INTERIM FEE APPLICATION 

SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

furtherance of this effort, the Receiver has imposed a per diem limit on meal expenses and no 

costs incurred in excess thereof are charged to the Receivership. No out-of-town meals and 

expenses were incurred during this Application Period. 

III. AUTHORITY SUPPORTING REQUEST FOR APPROVAL OF FEES AND 

EXPENSES INCURRED FROM JANUARY 1, 2022 THROUGH MARCH 31, 2022 

The Order Appointing Receiver provides that “[t]he Receiver and Retained Personnel are 

entitled to reasonable compensation and expense Reimbursement from the Receivership 

Estates....”8 Applications for compensation and expense reimbursement are on an interim basis, 

subject to final review at the close of the Receivership.9

 Allowed fees are subject to a twenty 

percent (20%) holdback pending final review and closing of the Receivership. Allowed expenses 

are not subject to a holdback. 

The Receiver requests that the Court approve the fees and expenses incurred by the 

Receiver and his retained professionals for the period from January 1, 2022 through March 31, 

2022.

A. This is the Twenty-Fourth Interim Fee Application and the Court has 

previously approved the prior Eighteen Interim Fee Applications

This is the Twenty-Fourth Interim Fee Application of the Receiver and his retained 

professionals. The initial Interim Fee Application was filed on September 22, 2016 [Dkt. 251]. 

The Court approved the fees and expenses requested in the Interim Fee Application on October 

21, 2016 [Dkt. 273]. The Second Interim Fee Application was filed on December 12, 2016 [Dkt. 

315]. The Court approved the fees and expenses requested in the Second Fee Application on 

 

8

 Dkt. 156, ¶ 45. 

9

 Dkt. 156, ¶ 47. 

Case 3:16-cv-00438-JR Document 992 Filed 07/07/22 Page 33 of 41
Page 34 - RECEIVER'S REQUEST FOR APPROVAL OF TWENTYFOURTH INTERIM FEE APPLICATION 

SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

February 22, 2017 [Dkt. 370]. The Third Interim Fee Application was filed on April 4, 2017 

[Dkt. 393]. The Court approved the fees and expenses requested in the Third Fee Application on 

April 20, 2017 [Dkt. 416]. The Fourth Interim Fee Application was filed on July 14, 2017 [Dkt. 

475]. The Court approved the fees and expenses requested in the Fourth Fee Application on July 

17, 2017 [Dkt. 478]. The Fifth Interim Fee Application was filed on October 11, 2017 [Dkt. 

544]. The Court approved the fees and expenses requested in the Fifth Fee Application on 

October 12, 2017 [Dkt. 548]. The Sixth Interim Fee Application was filed on December 12, 2017 

[Dkt. 567]. The Court approved the fees and expenses requested in the Sixth Fee Application on 

December 12, 2017 [Dkt. 570]. The Seventh Interim Fee Application was filed on March 16, 

2018 [Dkt. 596]. The Court approved the fees and expenses requested in the Seventh Fee 

Application on March 20, 2018 [Dkt. 599]. The Eighth Interim Fee Application was filed on 

June 26, 2018 [Dkt. 630]. The Court approved the fees and expenses requested in the Eighth Fee 

Application on June 26, 2018 [Dkt. 633]. The Ninth Interim Fee Application was filed on 

September 17, 2018 [Dkt. 654]. The Court approved the fees and expenses requested in the 

Ninth Fee Application on September 18, 2018 [Dkt. 657]. The Tenth Interim Fee Application 

was filed on December 7, 2018 [Dkt. 665]. The Court approved the fees and expenses requested 

in the Tenth Fee Application on December 10, 2018 [Dkt. 668]. The Eleventh Interim Fee 

Application was filed on March 21, 2019 [Dkt. 677]. The Court approved the fees and expenses 

requested in the Eleventh Fee Application on March 21, 2019 [Dkt. 680]. The Twelfth Interim 

Fee Application was filed on June 27, 2019 [Dkt. 716]. The Court approved the fees and 

expenses requested in the Twelfth Fee Application on July 1, 2019 [Dkt. 719]. The Thirteenth 

Case 3:16-cv-00438-JR Document 992 Filed 07/07/22 Page 34 of 41
Page 35 - RECEIVER'S REQUEST FOR APPROVAL OF TWENTYFOURTH INTERIM FEE APPLICATION 

SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

Interim Fee Application was filed on June 27, 2019 [Dkt. 771]. The Court approved the fees and 

expenses requested in the Thirteenth Fee Application on July 1, 2019 [Dkt. 774]. The Fourteenth 

Interim Fee Application was filed on December 27, 2019 [Dkt. 782]. The Court approved the 

fees and expenses requested in the Fourteenth Fee Application on January 1, 2020 [Dkt. 788]. 

The Fifteenth Interim Fee Application was filed on March 31, 2020 [Dkt. 814]. The Court 

approved the fees and expenses requested in the Fifteenth Fee Application on April 1, 2020 [Dkt. 

817]. The Sixteenth Interim Fee Application was filed on June 19, 2020 [Dkt. 839]. The Court 

approved the fees and expenses requested in the Sixteenth Fee Application on June 19, 2020 

[Dkt. 842]. The Seventeenth Interim Fee Application was filed on September 11, 2020 [Dkt. 

844]. The Court approved the fees and expenses requested in the Seventeenth Fee Application on 

September 11, 2020 [Dkt. 847]. The Eighteenth Interim Fee Application was filed on December 

17, 2020 [Dkt. 868]. The Court approved the fees and expenses requested in the Eighteenth Fee 

Application on January 4, 2021 [Dkt. 871]. The Nineteenth Interim Fee Application was filed on 

March 30, 2021 [Dkt. 878]. The Court approved the fees and expenses requested in the 

Nineteenth Fee Application on April 21, 2021 [Dkt. 884]. The Twentieth Interim Fee 

Application was filed on July 12, 2021 [Dkt. 892]. The Court approved the fees and expenses 

requested in the Twentieth Fee Application on July 27, 2021 [Dkt. 899]. The Twenty-First 

Interim Fee Application was filed on September 22, 2021 [Dkt. 908]. The Court approved the 

fees and expenses requested in the Twenty-First Fee Application on October 7, 2021 [Dkt. 911]. 

The Twenty-Second Interim Fee Application was filed on December 20, 2021 [Dkt. 917]. The 

Court approved the fees and expenses requested in the Twenty-Second Fee Application on 

Case 3:16-cv-00438-JR Document 992 Filed 07/07/22 Page 35 of 41
Page 36 - RECEIVER'S REQUEST FOR APPROVAL OF TWENTYFOURTH INTERIM FEE APPLICATION 

SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

January 7, 2022 [Dkt. 921]. The Twenty-Third Interim Fee Application was filed on March 23, 

2022 [Dkt. 958]. The Court approved the fees and expenses requested in the Twenty-Third Fee 

Application on April 4, 2022 [Dkt. 975]. The following is a summary of the fees and expenses 

requested and approved from the prior Interim Fee Applications, the amounts allowed, the 

amounts paid, and identification of the twenty percent (20%) holdback for fees (which remain 

unpaid as required by the Billing Instructions): 

B. The Court should approve as reasonable and necessary all of the fees 

and expenses requested in this Twenty-Fourth Interim Fee 

Application.

In the Ninth Circuit, in a common fund case such as this Receivership proceeding, the 

Court has the “discretion to apply either the lodestar method or the percentage-of-the-fund 

method when calculating fees.”10 “Under either method, the Court must exercise its discretion to 

 

10 Fischel v. Equitable Life Assurance Soc’y, 307 F.3d 997, 1006 (9th Cir 2002) (class action 

case creating a common fund). 

Aequitas Receivership

Professional Fees & Expenses by Entity (through December 31, 2021)

Entity

 Previous

Fees 

 Previous

Expenses 

 Total Previous 

Fees & Expenses 

 Holdback 

Amounts Total Paid Amounts 

Receiver 2,452,759 45,172 2,497,931 490,552 2,007,379 

FTI Consulting 18,852,562 494,849 19,347,412 3,770,512 15,576,899 

Pepper Hamilton 2,472,630 282,614 2,755,244 494,526 2,260,718 

Schwabe, Williamson & Wyatt 10,390,672 68,833 10,459,505 2,078,134 8,381,371 

Morrison Foerster 1,010,847 5,843 1,016,690 202,169 814,521 

Law Office of Stanley H. Shure 1,514,882 9,588 1,524,470 302,976 1,221,493 

Snell & Wilmer 540,808 10,645 551,453 108,162 443,291 

Parsons Farnell & Grein 539,151 18,983 558,134 107,830 450,304 

Pachulski Stang Ziehl & Jones 39,984 471 40,455 7,997 32,458 

Akin Gump 60,259 133 60,392 12,052 48,340 

Ater Wynne 10,356 - 10,356 2,071 8,285 

Total: 37,884,909 937,132 38,822,041 7,576,982 31,245,059 

Case 3:16-cv-00438-JR Document 992 Filed 07/07/22 Page 36 of 41
Page 37 - RECEIVER'S REQUEST FOR APPROVAL OF TWENTYFOURTH INTERIM FEE APPLICATION 

SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

achieve a ‘reasonable’ result.”11

Because there is a strong presumption that the lodestar amount represents a reasonable 

fee, adjustments to the lodestar are the “exception rather than the rule.”12 Under the lodestar 

method, the Court multiplies a reasonable number of hours by a reasonable hourly rate.13 In the 

current Receivership, where neither the amount of the common fund nor the aggregate amount of 

allowed claims has been determined, the lodestar method rather than the percentage-of-fund 

method should be applied to this interim fee application. 

The amount of compensation to be awarded a court-appointed receiver is within the 

Court’s reasonable discretion.14 The Commission’s approval of an application should be given 

great weight.15

Factors for consideration include the “time, labor and skill required, but not necessarily 

that actually expended, in the proper performance of the duties imposed by the court upon the 

receiver, the fair value of such time, labor and skill measured by conservative business standards, 

the degree of activity, integrity and dispatch with which the work is conducted and the result 

obtained.”16 The complexity and difficulty associated with the receivership are highly relevant 

 

11 In re Galena Biopharma, Inc., Sec. Litig., No. 3:14-cv-00367-SI, 2016 U.S. Dist. LEXIS 

82693, at *15-16 (D. Or. June 24, 2016) (citing In re Bluetooth Headset Prods. Liab. Litig., 654 

F.3d 935, 942 (9th Cir. 2011)). 

12 Stanger v. China Elec. Motor, Inc. 812 F.3d 734, 738 (9th Cir 2016) (internal citations 

omitted) (class action with common fund settlement). 

13 Id.

14 SEC v. Byers, 590 F. Supp. 2d 637, 644 (S.D.N.Y. 2008), aff’d, 609 F.3d 87 (2d Cir. 2010).

15 Id. (quoting SEC v. Fifth Ave. Coach Lines, Inc., 364 F. Supp. 1220, 1222 (S.D.N.Y. 1973) 

(securities receivership).

16 United States v. Code Prod. Corp., 362 F.2d 669, 673 (3d Cir. 1966) (internal citation 

Case 3:16-cv-00438-JR Document 992 Filed 07/07/22 Page 37 of 41
Page 38 - RECEIVER'S REQUEST FOR APPROVAL OF TWENTYFOURTH INTERIM FEE APPLICATION 

SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

factors in determining the reasonableness of professional fees.17 The benefits bestowed on the 

estate are a relevant consideration.18

The degree of success achieved in solving legal and practical problems should be 

considered when calculating the fees awarded.19 Courts examine the credentials, experience, 

reputation, and other professional qualities required to carry out the court’s orders when 

assessing the reasonableness of the rates charged for services to a receivership.20 

The Court should consider the usual and customary fees charged and the evidence 

presented to support the application for fees.21 All of the factors considered in these cases weigh 

 

omitted).

17 See Fifth Ave. Coach Lines, 364 F. Supp. at 1220 (awarding interim fees and expenses to law

firm for role in receivership and noting that it involved wide variety of complex legal matters 

requiring the time, competence, and diverse resources of a law firm of high caliber); SEC v. 

Mobley, No. 00 CV 1316 RCC, 2000 WL 1702024, at *2 (S.D.N.Y. Nov. 13, 2000) (finding that 

fees requested in early stages of receivership were not excessive where receiver was faced with 

deconstructing an “enormous” fraud of seven years in which defendant utilized over forty 

entities to funnel investors’ money throughout the world and there were few, if any, verifiable 

financial records). 

18 See Fifth Ave. Coach Lines., 364 F. Supp. at 1222; Mobley, 2000 WL 1702024, at *2 (receiver 

marshaled assets quickly and efficiently).

19 See SEC v. W.L. Moody & Co., Bankers, 374 F. Supp. 465, 484-85 (S.D. Tex. 1974), aff’d, 519 

F.2d 1087 (5th Cir 1975) (attorney’s timely action prevented delay in payment to bank 

depositors); Fifth Ave. Coach Lines, 364 F. Supp. at 1222 (law firm’s services resulted in 

successful reorganization of company); SEC v. Tanner, No. 05–4057–RDR, 2007 WL 2013606, 

at *2 (D. Kan. May 22, 2007) (actions of receiver resulted in return of more money to investors 

than if defendant had continued in business). 

20 See W.L. Moody & Co., 374 F. Supp. at 481 (holding that a court should give “considerable 

weight” to “a receiver’s abilities, as required by the tasks of the receivership”); SEC v. Aquacell 

Batteries Inc., No. 6:07–cv–608–Orl–22 DAB, 2008 WL 276026, at *4 (M.D. Fla. Jan. 31, 2008) 

(“The Receiver retained well qualified, experienced counsel and such representation does not 

come cheap.”).

21 See Fifth Ave. Coach Lines, Inc., 364 F. Supp. at 1222 (fees awarded in full based on law 

firm’s usual hourly rate and supported by meticulous records).

Case 3:16-cv-00438-JR Document 992 Filed 07/07/22 Page 38 of 41
Page 39 - RECEIVER'S REQUEST FOR APPROVAL OF TWENTYFOURTH INTERIM FEE APPLICATION 

SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

heavily in favor of approving the fees and expenses requested in the Twenty-Fourth Interim Fee 

Application. 

C. The fees and expenses during this Twenty-Fourth Application Period 

are reasonable and necessary in light of the complexity and difficulties 

of this case.

The Receiver requests approval of fees and expenses for the firms identified herein, 

which have provided the services summarized throughout this Motion, in the March 2022 Report 

and in each firm’s summary invoice.22 As noted, these firms agreed to substantial discounts of 

their customary fees, and the amounts requested reflect those discounts. The time spent, services 

performed, hourly rates charged, and expenses incurred were in the best interests of the 

Receivership Entity and were indeed essential for the Receiver to perform his Court-ordered 

duties.23 Each of these professional firms was selected because it possesses special expertise 

required to fulfill the Court’s orders. The following chart is a summary of the fees and expenses 

reasonably incurred in the service of the Receivership Entity from January 1, 2022 through 

March 31, 2022: 

 

22 Greenspan Declaration, Exhibits A through D.

23 Greenspan Declaration, p. 3. 

Case 3:16-cv-00438-JR Document 992 Filed 07/07/22 Page 39 of 41
Page 40 - RECEIVER'S REQUEST FOR APPROVAL OF TWENTYFOURTH INTERIM FEE APPLICATION 

SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

D. The fees and expenses requested are in line with those approved in 

other cases. 

The fees associated with complex receivership cases are often substantial percentages of 

the total assets recovered.24 The size and scope of this equitable receivership are much greater 

than the size and scope of many of the receiverships in the reported cases cited in this 

Application. Courts have noted that compensation to equitable receivers is analogous to 

compensation to trustees in bankruptcy.25 The United States Department of Justice reported that 

from 1994 to 2000, in Chapter 7 asset cases, 30% to 40% of total estate receipts were disbursed 

as fees and expenses to trustees and other professionals.26 This was true regardless of the size of 

 

24 SEC v. Megafund Corp., No. 3:05–CV–1328–L, 2008 WL 2839998, at *2 (N.D. Tex. June 24, 

2008) (approving final request for fees and expenses comprising 22.4% of total recovery by 

Receiver in light of complexities of case, difficulties in tracing proceeds, and results obtained); 

SEC v. Funding Res. Group, No. Civ.A.3:98–CV–2689–M, 2003 WL 145411, at *1 (N.D. Tex. 

Jan. 15, 2003) (costs of administration totaled 21% of cash and assets finally recovered by 

receiver). 

25 W.L. Moody & Co., 374 F. Supp. at 481. 

26 U.S. DOJ, U.S. Trustee Program Prelim. Rep. on Ch. 7 Asset Cases 1994 to 2000, attached as 

Aequitas Receivership

Professional Fees & Expenses by Entity (from January 1 to March 31, 2022)

Entity Fees ($) Percentage Expenses ($) Percentage Total ($) Percentage

Receiver 15,510.00 3.0% - 0.0% 15,510.00 2.8%

FTI Consulting 189,707.00 36.2% - 0.0% 189,707.00 34.3%

Pepper Hamilton [1] 0.0% - - 0.0% - 0.0%

Schwabe, Williamson & Wyatt 317,606.50 60.6% 28,071.23 100.0% 345,677.73 62.6%

Morrison Foerster (1) 0.0% - - 0.0% - 0.0%

Law Office of Stanley H. Shure (1) 0.0% - - 0.0% - 0.0%

Snell & Wilmer (1) 0.0% - - 0.0% - 0.0%

Parsons Farnell & Grein 1,549.12 0.3% - 0.0% 1,549.12 0.3%

Pachulski Stang Ziehl & Jones [1] 0.0% - - 0.0% - 0.0%

Akin Gump [1] 0.0% - - 0.0% - 0.0%

Ater Wynne [1] 0.0% - - 0.0% - 0.0%

Total: 524,372.62 100% 28,071.23 100% 552,443.85 100%

[1] Pepper Hamilton, Morrison Foerster, Law Office of Stanley H. Shure, Snell & Wilmer, Pachulski Stang Ziehl & Jones, Akin Gump, and Ater Wynne did 

not incur fees or expenses during the billing period.

Case 3:16-cv-00438-JR Document 992 Filed 07/07/22 Page 40 of 41
Page 41 - RECEIVER'S REQUEST FOR APPROVAL OF TWENTYFOURTH INTERIM FEE APPLICATION 

SCHWABE, WILLIAMSON & WYATT, P.C. 

Attorneys at Law 

1211 SW 5th Ave., Suite 1900 

Portland, OR 97204 

Telephone: 503.222.9981 

Fax: 503.796.2900 

PDX\[Client\Matter]\[AuthorID]\33911528.2 

the case.27 The fees incurred in this case are a significantly smaller percentage of the total 

recoveries through the end of the Twenty-Fourth Application Period than any of these cases and 

the Receivership Entity has benefitted by avoiding additional fees that would have been incurred 

if investment bankers were retained. 

IV. CONCLUSION 

The relief requested herein is appropriate and in furtherance of the provisions of the Final 

Receivership Order appointing the Receiver. Accordingly, the Receiver respectfully requests that 

the Court enter an order approving the fees and expenses requested in the Twenty-Fourth Interim 

Fee Application, for the period from January 1, 2022 through March 31, 2022. 

Dated this 7th day of July, 2022. 

Respectfully submitted, 

SCHWABE, WILLIAMSON & WYATT, P.C. 

By: _/s/ Troy Greenfield__________________ 

Troy Greenfield, OSB #892534 

tgreenfield@schwabe.com 

Lawrence R. Ream (Admitted Pro Hac Vice) 

lream@schwabe.com 

Telephone: 503-222-9981 

Facsimile: 503-796-2900 

Attorneys for Receiver for Defendants Aequitas 

Management, LLC, Aequitas Holdings, LLC, 

Aequitas Commercial Finance, LLC, Aequitas 

Capital Management, Inc., and Aequitas 

Investment Management, LLC

 

Exhibit P, App’x 187, 192. 

27 Id. 

Case 3:16-cv-00438-JR Document 992 Filed 07/07/22 Page 41 of 41