Court Opinion

ID: 9917264
Source: CourtListenerOpinion
Date Created: 2024-01-11 20:00:48.43765+00
Date Added: 2024-06-11T08:02:01.604073
License: Public Domain

USCA11 Case: 23-11927      Document: 33-1       Date Filed: 01/11/2024   Page: 1 of 6

                                                      [DO NOT PUBLISH]
                                       In the
                United States Court of Appeals
                           For the Eleventh Circuit

                            ____________________

                                     No. 23-11927
                             Non-Argument Calendar
                            ____________________

       SECURITIES AND EXCHANGE COMMISSION,
                                                    Plaintiﬀ-Appellee,
       ALAN J. CANDELL, et al.,
                                                 Intervenor Plaintiﬀs,
       RYAN K. STUMPHAUZER,
       Court Appointed Receiver for Complete Business Solutions, Inc.
       and other receivership entities,
                                           Interested Party-Appellee,
       versus
       COMPLETE BUSINESS SOLUTIONS GROUP, INC.,
       d.b.a. Par Funding, et al.,
                                                                Defendants,
       JOSEPH COLE BARLETA,
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       2                      Opinion of the Court                23-11927

       a.k.a. Joe Cole,
                                                     Defendant-Appellant,
       FRED A. SCHWARTZ,
                                                       Consol. Defendant,
       LEAD FUNDING II, LLC, et al.,
                                                               Intervenors.
                            ____________________

                  Appeal from the United States District Court
                      for the Southern District of Florida
                     D.C. Docket No. 9:20-cv-81205-RAR
                           ____________________

       Before JILL PRYOR, NEWSOM, and BRANCH, Circuit Judges.
       PER CURIAM:
              Joseph Cole Barleta (“Cole”) appeals the district court’s con-
       tempt order and the accompanying sanctions levied against him.
       That order emerged from a discovery dispute between Cole and
       the Receivership created to control an entity for which Cole previ-
       ously worked and served as an officer. On appeal, Cole makes two
       main arguments challenging the contempt order and related sanc-
       tions. First, he contends that the Receivership ceased to exist dur-
       ing the litigation due to provisions in the Federal Debt Collection
       Procedures Act and, accordingly, did not “have standing” to ask for
       the contempt order and sanctions at issue here on appeal. Second,
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       23-11927              Opinion of the Court                        3

       he asserts that the discovery dispute between him and the Receiv-
       ership became “stale” before the district court granted the con-
       tempt order. In the event we disagree, Cole also asks us to reduce
       the sanctions amount imposed on him by the district court. After
       careful review, we conclude that all of Cole’s arguments fail and
       we thus affirm the district court’s order and sanctions.
                                        I
               The narrow issues presented in this appeal stem from a
       broader securities fraud litigation involving Par Funding and asso-
       ciated companies. At the outset of the litigation, the SEC asked the
       district court to appoint a receiver to preserve the assets and rec-
       ords of Par Funding and affiliated entities. The district court
       granted this request and authorized the Receiver—among other
       things—to collect financial records relating to the entities falling
       under its purview. In the same order, the district court ordered
       past and present officers and employees of the entities covered by
       the Receivership to turn over such financial information.
              Cole is one of those covered individuals. After Cole repeat-
       edly refused to turn over documents sought by the Receiver—in-
       cluding information requested pursuant to a granted motion to
       compel—the district court held Cole in contempt. The district
       court also found Cole’s reluctance to hand over the requested in-
       formation sufficiently obstinate to issue sanctions against him.
             On appeal, Cole challenges the validity of the contempt or-
       der and the sanctions levied against him. First, he argues that the
       Receivership ceased to exist before the district court issued the
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       4                       Opinion of the Court                  23-11927

       contempt order because of provisions in the FDCPA. Second, he
       contends the discovery requests giving rise to the Receiver’s mo-
       tion to compel were “stale,” and thus, the ensuing contempt order
       was void. Third, he argues that the sanctions accompanying the
       contempt order were invalid for similar reasons, and even if we
       disagree, he asks us to reduce the sanctions awarded by the district
       court.
                                          II
              We review the district court’s civil contempt findings under
       an abuse of discretion standard. Citronelle-Mobile Gathering, Inc. v.
       Watkins, 943 F.2d 1297, 1301 (11th Cir. 1991). “A district court
       abuses its discretion if it applies an incorrect legal standard, applies
       the law in an unreasonable or incorrect manner, follows improper
       procedures in making a determination, or makes findings of fact
       that are clearly erroneous.” Citizens for Police Accountability Pol.
       Comm. v. Browning, 572 F.3d 1213, 1216–17 (11th Cir. 2009). We
       review a district court order of sanctions under that same standard
       of review. Barnes v. Dalton, 158 F.3d 1212, 1214 (11th Cir. 1998).
               Cole first argues that the contempt order was invalid be-
       cause provisions in the FDCPA effectively ended the Receivership.
       For support, he points us primarily to 28 U.S.C. § 3103, which says
       that “[a] receivership shall not continue past the entry of judg-
       ment.” This argument is without merit. As other provisions in the
       Act demonstrate, the FDCPA lays out procedure rules for debt col-
       lection. 28 U.S.C. § 3001(a). The Receivership was not created to
       collect a debt from Cole or, for that matter, anyone else on behalf
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       23-11927                   Opinion of the Court                                5

       of the United States. Instead, the district court appointed the Re-
       ceiver at the request of the SEC to preserve assets and records be-
       longing to companies subject to an ongoing enforcement action.
       Accordingly, the FDCPA’s rules for ending a receivership after “en-
       try of judgment” in § 3103 are irrelevant to this appeal, and Cole’s
       argument that the Receivership lacked “standing” fails.
               Cole next argues that the contempt order was illegitimate
       because the discovery dispute giving rise to the contempt finding
       was “stale.” In brief, Cole argues that the Receiver “abandoned”
       its discovery requests. This argument likewise fails. The Receiver
       initially requested documents and interrogatories on January 12,
       2021. Cole never responded to the Receiver or objected to this re-
       quest. The Receiver then asked Cole’s counsel for relevant infor-
       mation again on February 21, 2022. Cole refused. After more back
       and forth with Cole’s counsel, the Receiver filed a motion to com-
       pel Cole to produce requested materials on March 19, 2022, which
       the district court granted on April 29, 2022. The discovery saga
       wore on, ultimately ending with the district court holding Cole in
       contempt of court. We see no evidence in this timeline that the
       Receiver ever “abandoned” its discovery requests. 1 If anything, the

       1 Cole’s references to district court decisions do not help his argument on this

       front. In those cases, the discovery deadline was near or had passed, or the
       requesting party had failed to move to compel. Here, by contrast, Cole does
       not argue that the discovery end date was immediate or that it had passed.
       And, given the facts of this case, it is clear that the Receivership had moved to
       compel Cole to produce the relevant documents.
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       6                      Opinion of the Court                 23-11927

       record suggests any delays in the production of documents are due
       to Cole’s recalcitrance.
               Finally, Cole challenges the validity of the sanctions accom-
       panying the district court’s contempt order as well as the amount
       of sanctions awarded. While difficult to discern, Cole’s attack on
       the legitimacy of the district court’s sanctions order appears to rely
       mainly on his argument about the FDCPA’s applicability. For rea-
       sons already explained, we conclude this argument lacks merit. In
       any event, Cole fails to appreciate that the district court sanctioned
       him for his broader practice of ignoring the court’s orders during
       discovery, not just for making his FDCPA argument. Accordingly,
       he has given us no reason to conclude that the district court abused
       its discretion when it issued sanctions, either concerning its deci-
       sion to issue sanctions in the first place or the specific amount of
       attorneys’ fees awarded.
             AFFIRMED.