IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 12-10822

SECURITIES AND EXCHANGE COMMISSION,

Plaintiff

v.

STANFORD INTERNATIONAL BANK, LTD, ET AL,

Defendants

TRUSTMARK NATIONAL BANK,

Intervenor-Appellant

v.

RALPH S. JANVEY,

Appellee

Appeal from the United States District Court

for the Northern District of Texas

USDC No. 3:09-CV-298

Before WIENER, DENNIS, and OWEN, Circuit Judges.

PER CURIAM:*

United States Court of Appeals

Fifth Circuit

F I L E D

January 8, 2014

Lyle W. Cayce

Clerk

* Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not

be published and is not precedent except under the limited circumstances set forth in 5TH CIR.

R. 47.5.4.

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As we stated the last time intervenor-appellant Trustmark National Bank

(“Trustmark”) appeared before us in connection with this matter, “[t]his is one

of many cases stemming from the purported Stanford Financial Ponzi scheme.” 

SEC v. Stanford Int’l Bank, Ltd. (“Trustmark I”), 465 F. App’x 316, 317 (5th Cir.

2012) (per curiam) (unpublished). By way of general background, we have

several times explained that these cases

arise[] out of an alleged multi-billion-dollar Ponzi scheme

perpetrated by the Stanford companies (“Stanford”), a network of

some 130 entities in 14 countries controlled by R. Allen Stanford.

According to the SEC, the companies’ core objective was to sell

certificates of deposit (“CD’s”) issued by Stanford International

Bank Limited in Antigua (“Stanford Bank”). Stanford achieved and

maintained a high volume of CD sales by promising above-market

returns and falsely assuring investors that the CDs were backed by

safe, liquid investments. For almost 15 years, the Bank represented

that it consistently earned high returns on its investment of CD

sales proceeds, ranging from 12.7% in 2007 to 13.93% in 1994. In

fact, however, the Bank had to use new CD sales proceeds to make

interest and redemption payments on pre-existing CDs, because it

did not have sufficient assets, reserves and investments to cover its

liabilities.

Id. at 318 (quoting Janvey v. Adams, 588 F.3d 831, 833 (5th Cir. 2009)).

The roots of the present appeal are in Trustmark’s “issu[ance] [of] letters

of credit to several companies conducting business with Stanford.” Id. Relevant

here, Trustmark issued a letter of credit dated November 1, 2007 to HP

Financial Services Venezuela (“HPFS”) in the amount of $1,986,745 in

connection with HPFS’s lease of computer equipment to Stanford. Trustmark’s

liability on the letter of credit was secured by issuing a CD to Stanford and

Stanford placing cash collateral in a Trustmark deposit account. Id. HPFS

intervened in the underlying SEC action “to clarify whether the Receivership

Order enjoins or otherwise applies to draws under letters of credit issued by

Trustmark.” Id. Thereafter,Trustmark intervened to seek “‘an order modifying,

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clarifying, or enforcing [the Receivership Order] as necessary to grant

Trustmark authority to exercise its rights as a secured creditor’ and ‘authority

under . . . the [Receivership Order] to exercise its set-off rights against cash

collateral.’” Id. at 318-19 (first and third alterations in original). “[T]he district

court allow[ed] [HPFS] to present [the] letter of credittoTrustmark for payment,

but refus[ed] to allow Trustmark to offset the funds from Stanford who is

currently under the receivership of Ralph S. Janvey (‘Janvey’ or ‘the

Receiver[]’).” Id. at 317.

We affirmed, holding that “the conclusion reached by the district court

[was] correct” because “the tripartite nature of letter of credit transactions

required Trustmark to pay HPFS with Trustmark funds, not Receivership

funds.” Id. at 320 (citing In re Compton Corp., 831 F.2d 586, 589 (5th Cir.

1987)). We reasoned that “honoring the letter of credit is exactly the position

Trustmark put itself in by issuing the letter of credit in the first place.” Id. We

further stated:

Trustmark may resent this ruling since it requires it to pay

immediately, while requiring it to enter into a more contorted

process for satisfying its secured claim. This, however, is the nature

of receivership and does not prevent it from seeking a settlement

with the Receiver to avoid that potentially lengthy process. Nor

does it necessarily dictate the outcome of any future claims

Trustmark might have since this ruling is strictly limited to the

facts of this case as they stand at this time in the receivership

process.

Id. at 321.

Subsequent to our decision in Trustmark I, the Receiver on April 17, 2012

moved the district court to order Trustmark to deliver the cash collateral in the

deposit account to the Receiver. On July 24, 2012, the district court granted the

Receiver’s motion and “order[ed] Trustmark to turnover [sic] the contents of the

Account to the Receiver within seven (7) days.” However, Trustmark instead

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moved the district court on July 31 to modify its order so as to permit Trustmark

to tender the funds to the district court registry rather than to the Receiver. On

August 9, the district court issued an order denying that motion and further

advising Trustmark that “[b]ecause Trustmark has failed to comply with the

Court’s Turnover Order, [the Court] [will] fine[] Trustmark $1,000.00 for each

day it delays payment beginning the day after the date of this Order, that fine

doubling each day thereafter.” That same day, Trustmark filed a notice of

appeal as to these orders. Trustmark ultimately complied with the turnover

order on August 13, 2012 and paid $15,000 in fines pursuant to the contempt

order. 

In this appeal, Trustmark principally argues that the district court’s entry

of the turnover order prior to the effectuation of a “secured claims distribution

plan” constituted a deprivation of due process by “destroy[ing]” Trustmark’s

purportedly perfected secured creditor status without sufficient procedural

safeguards.1 Trustmark also argues that the turnover order violates 12 U.S.C.

§ 91, which prohibits state courts from issuing an “attachment, injunction, or

execution” against a national bank “before final judgment.” For the following

reasons, we affirm the orders of the district court.

We first address Trustmark’s procedural due process argument.

Trustmark frames its argument as raising the question of “whether [the] district

court[,] sitting . . . in equity, has the power to deprive [Trustmark] of its security

in the pursuit of the broader interests of recouping funds to repay Stanford’s

1 Trustmark contends that “[i]t is undipusted that Trustmark has a properly perfected

security interest in the Deposit Account.” In fact, the Receiver does dispute this, asserting

that “[it] has never conceded and no court has ever held that Trustmark has a valid security

interest in the cash collateral”; and that “[b]ecause the cash collateral consists of proceeds

from the sale of fraudulent CDs, Stanford Venezuela could not have transferred a valid

security interest in that collateral to Trustmark.” For purposes of this appeal, we assume

without deciding that Trustmark has the security interest it claims. Cf. Trustmark I, 465 F.

App’x at 318 (“By issuing [letters of credit], Trustmark became a secured creditor with set-off

rights against cash collateral that Stanford had placed on deposit with Trustmark.”).

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‘putative victims’ (i.e., unsecured creditors).” Trustmark contends that eventual

participation in the Stanford receivership claims distribution process does not

“constitute an adequate substitute for the immediate seizure of Trustmark’s

secured property interest,” at least “until such time as a secured claims

distribution plan has been proposed by the Stanford Receiver and finally

approved by the District Court.” Trustmark asks this court to “direct[] the

Receiver to return the secured funds to Trustmark or post adequate substitute

security for the taking of the Secured Funds.” We conclude that Trustmark has

failed to demonstrate a violation of procedural due process.

“The Supreme Court has adopted a two-step analysis to examine whether

an individual’s procedural due process rights have been violated. The first

question ‘asks whether there exists a liberty or property interest which has been

interfered with by the [government]; the second examines whether the

procedures attendant upon that deprivation were constitutionally sufficient.’” 

Meza v. Livingstone, 607 F.3d 392, 399 (5th Cir. 2010). “Three factors are

considered in identifying the process that is due: (1) the private interest affected,

(2) the risk of an erroneous deprivation with the process supplied, and (3) the

government’s interests.” Wilson v. Birnberg, 667 F.3d 591, 601 (5th Cir. 2012).

This court has already affirmed that the funds Trustmark turned over to

the Receiver were Stanford property and thus properly part of the receivership

estate. Trustmark I, 465 F. App’x at 320-21. Accordingly, the turnover order did

not effect any deprivation from Trustmark as to those funds, and Trustmark

does not argue otherwise. Instead, Trustmark contends that its security interest

in the deposit funds constitutes a due process property interest, distinct from the

underlying Stanford funds, that has been “destroy[ed]” by the turnover order. 

Trustmark acknowledges that this court has not previously addressed the

question of whether a bank’s security interest in cash collateral on deposit

constitutes a property interest for procedural due process purposes, and we need

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not decide that question in this appeal. Rather, assuming that Trustmark’s

security interest is property within the meaning of the Due Process Clause of the

Fifth Amendment, we conclude that Trustmark has failed to “demonstrate that

the ‘[district court] has deprived [it]” of that interest.” See Wilson, 667 F.3d at

601.

As Trustmark itself repeatedly states in its briefing, it is well established

that “a receiver appointed by a federal court takes property subject to all liens,

priorities, or privileges existing or accruing under the laws of the state.”

Marshall v. New York, 254 U.S. 380, 385 (1920) (emphasis added). Trustmark

urges that this principle — repeatedly reaffirmed by subsequent courts2 —

exposes a constitutional infirmity in the district court’s orders. To the contrary,

we agree with Janvey that, as “a receiver appointed by a federal court,” his

receipt of the Stanford funds formerly on deposit with Trustmark is subject to

whatever pre-existing security interest Trustmark may have therein. See id.

Indeed, Trustmark acknowledges that “[t]he Receiver took all of Stanford’s

claims, including its Certificate of Deposit here, ‘subject to all liens, priorities,

or privileges existing . . . under state laws.’” (quoting Marshall, 254 U.S. at 385). 

In short, the very authorities that Trustmark cites in support of its argument

that the Turnover Order “destroy[ed]” its security interest are directly contrary

to that proposition.

“The Receiver’s task to ‘marshal, preserve and conserve the receivership

estate is as much for [Trustmark’s] benefit as for the benefit of [Stanford’s] other

2 See SEC v. Credit Bancorp, Ltd., 386 F.3d 438, 446 (2d Cir. 2004) (“[A] federal court

receiver takes property subject to a perfected lien or other established priority right.”);

Lankenau v. Coggeshall & Hicks, 350 F.2d 61, 66-67 (2d Cir. 1965) (“Assuming that [creditor]’s

attachment efforts were sufficiently perfected under the circumstances under state law to

create some kind of lien or priority rights in their favor, appointment of a federal court

receiver under orders to take charge of all of [the] property [of the defendant in the underlying

SEC action] does not destroy those rights. The receiver takes custody of the property subject

to any rights previously acquired by the attachment.” (citation omitted)).

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investors.” Trustmark I, 465 F. App’x at 321 (first alteration in original)

(quoting SEC v. Stanford Int’l Bank Ltd., 424 F. App’x 338, 341 (5th Cir. 2011)).

In the receivership claims process, Trustmark will have the opportunity to

“advis[e] the receiver and the court as to . . . the basis of [its] claim to . . .

priority.” See Commodity Futures Trading Comm’n v. Chilcott Portfolio Mgmt.,

725 F.2d 584, 586 (10th Cir. 1984) (quoting Ralph Ewing Clark, A Treatise on

the Law and Practice of Receivers § 541(a) (3d ed. 1959)). Given the

considerable scope ofthe allegedStanfordPonzi scheme, the receivership process

here may be “lengthy.” Trustmark I, 465 F. App’x at 321. “This, however, is the

nature of receivership.” Id.

Second, Trustmark briefly contends that 12 U.S.C. § 91 precludes

enforcement of the Turnover Order. Section 91 provides in pertinent part that

“no attachment, injunction, or execution, shall be issued against [a national

bank] or its property before final judgment in any suit, action, or proceeding, in

any State, county, or municipal court.” 12 U.S.C. § 91. Trustmark contends that

the turnover order amounts to an “injunction” against a national bank “before

final judgment” in violation of the statute. See id. Further, although the statute

by its terms applies only to state court actions, Trustmark argues that “the

Supreme Court [has] held that Section 91 applies ‘as well on the courts of the

United States.’” (quoting Pac. Nat’l Bank v. Mixter, 124 U.S. 721 (1888)). 

However, Trustmark’s reliance on Mixter is misplaced. The Supreme

Court has since clarified that § 91’s “anti-injunction provision . . . was meant to

have a limited scope” and “that Congress intended only to prevent state judicial

action, prior to final judgment, which would have the effect of seizing the bank’s

property,” as contrasted with “property belonging to others which happens to be

in the hands of the bank.” Third Nat’l Bank in Nashville v. Impac Ltd., Inc., 432

U.S. 312, 322-23 (1977) (emphasis added); see also id. at 324 (“[T]he statute

merely prevents prejudgment seizure of bank property by creditors of the

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bank.”). The district court’s order requiring Trustmark, as Stanford’s creditor,

to turn over receivership estate assets to the appointed receiver in this SEC

action does not fall within the “limited scope” of § 91. See id. at 322. It does not

constitute either “state judicial action,” see id., or a “seizure of bank property by

creditors of the bank,” see id. at 324. Accordingly, the turnover order does not

violate 12 U.S.C. § 91.3

Accordingly, we affirm the challenged orders of the district court.

3 Trustmark also contends, albeit in conclusory fashion, that the district court abused

its discretion by holding Trustmark in contempt because Trustmark’s offer to pay the funds

into the district court’s registry constituted a “good faith effort[] to comply with the Turnover

Order.” Trustmark waived this argument by failing to cite any authority in its appellate brief.

See United States v. Demmitt, 706 F.3d 665, 670 (5th Cir. 2013); Fed. R. App. P. 28(a)(9).

Moreover, Trustmark’s argument would fail even were it adequately briefed. “We review

contempt orders and sanctions imposed thereunder for an abuse of discretion.” Whitcraft v.

Brown, 570 F.3d 268, 271 (5th Cir. 2009). “A party commits contempt when he violates a

definite and specific order of the court requiring him to perform or refrain from performing a

particular act or acts with knowledge of the court’s order.” Travelhost, Inc. v. Blandford, 68

F.3d 958, 961 (5th Cir. 1995). The terms of the turnover and contempt orders were definite

and specific, and Trustmark failed to comply with their clear requirements. “[G]ood faith is

not a defense to a civil contempt order[] . . . .” Whitcraft, 570 F.3d at 272.

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