Opinion ID: 802495
Heading Depth: 2
Heading Rank: 2

Heading: Service Procedures

Text: In December 2008, the Enforcement Division served the OIP on CI-New York and on attorneys for the other U.S. respondents. On December 15, 2008, the Division moved to serve the OIP on Rapoport and the other Russian respondents through their U.S. counsel because Russian authorities refuse to execute U.S. requests for service of process. The Division’s motion relied on SEC Rule of Practice 141(a)(2)(iv), which provides that “[n]otice of a proceeding to a person in a foreign country may be made . . . by any . . . method reasonably calculated to give notice, provided that the method of service used is not prohibited by the law of the foreign country.” 5 New York attorney Richard Kraut filed a memorandum in opposition to the Division’s motion to serve Rapoport via Kraut. The memorandum included a footnote stating that Kraut “appear[s] solely for the purpose of opposing the Division’s motion. By submitting this Memorandum, [Rapoport] do[es] not admit to the Commission’s jurisdiction over [him].” The Administrative Law Judge (ALJ) granted the Enforcement Division’s motion to serve foreign representatives by serving their U.S. counsel. Thereafter, Rapoport moved for vacatur or reconsideration. On February 5, 2009, the ALJ denied the motion for vacatur or reconsideration and ordered that the service of the OIP on Rapoport and another Russian respondent be considered effective as of January 8, 2009, the last date on which the “Foreign Respondents received the OIP as confirmed by return receipt of certified mail.” On February 12, 2009, Kraut filed notice of his withdrawal of his representation of Rapoport, effective February 5, 2009. Rapoport never suggested that he did not receive actual notice of the issuance of the OIP or the February 5, 2009 order. At oral argument, Rapoport’s current counsel confirmed that Rapoport does not contend that he was unaware of the SEC proceedings.