A: When a judicial enforcement action is initiated by a federal regulatory authority, like the U.S. Securities and Exchange Commission (the “SEC”), that regulator sometimes seeks the appointment of a Receiver to take custody and control of the defendants’ assets until the litigation is resolved pursuant to United States law (the “Receivership”). These Receivers are referred to as “Federal Equity Receivers.” The Receiver is an officer of, and overseen by, the court. In this case, the Receiver was appointed by the United States District Court for the District of Colorado and is charged with, among other things, marshaling and preserving the assets of the defendants pending a determination of whether, and to the extent, the defendants have liability for the allegations contained in the SEC’s complaint.

A: The Court appointed Mark B. Conlan, Esq., of Gibbons P.C., as Receiver to marshal the assets of the individuals and entities in Receivership as set forth in an Ex Parte Asset Freeze, Temporary Restraining Order, Order to Show Cause, and other Emergency Relief [ECF No. 10] (as amended, the “Asset Freeze Order”).

In addition, the Receiver files periodic reports with the Court regarding his activities. These reports are posted to this website after they are filed with the Court. The Receiver’s fiduciary responsibilities include collecting and liquidating the receivership defendants’ assets that are the subject of the Asset Freeze Order in order to preserve the value of those assets for distribution to claimants that have legitimate claims against the receivership defendants.

A: The Receiver is not your lawyer, and he cannot provide you with legal advice. He is the Court’s agent, and is charged with effectuating the provisions of the Court’s Orders. You should consult with your own lawyer if you believe you have claims against any third party.

A: Investors are not prevented by the Court’s orders from pursuing their own claims so long as they do not seek to violate the Court’s Asset Freeze Order. We are also aware that certain investors have engaged their own counsel to represent them with the prosecution of their own potential claims against the Receivership defendants and/or the Receivership entity defendants’ prime broker. See, e.g., Case No. 9:21-cv-80382-AMC, U.S. District Court for the Southern District of Florida, In Re: Equiti US, LLC, et al.

A: The Court has not yet ordered the Receiver to commence a claims process in this case.

A: The timing of any distributions is unknown at this time. To the extent that there is a finding of liability against one or more of the Receivership defendants on the allegations raised by the SEC’s complaint, the Court may direct the Receiver to propose a plan of distribution for the Court’s consideration. The timing of distributions may be impacted by, among other things, the commencement and completion of a claims process, which may involve litigation of any disputed claims (for which the establishment of reserves may be required if not resolved prior to the approval of a plan of distribution) and the assets available for distribution. No plan of distribution will be filed unless, until and after the Receiver is directed to run a claims reconciliation process.

A: The Receiver has not yet proposed a plan by which funds will be distributed to investors and creditors. The Receiver, however, is mindful that any such plan must be fair and equitable. That plan will ultimately be subject to review and approval by the Court upon proper adequate notice to all investors.

A: At this time the Receiver cannot state what recoveries will be for investors in this case. Unless and until the Court directs the Receiver to conduct a claims process, the Receiver cannot project what the recovery percentage or distributions to investors will be.

A: In order to support a properly filed claim, you will need to include evidence of your investments in and distribution from the Receivership entity defendants: Mediatrix Capital Inc., Blue Isle Markets Inc., and/or Blue Isle Markets Ltd.

A: All key documents in the case have been (or will be) posted to the Receiver’s website: https://mediatrixreceivership.com/

A: You can contact the Receiver by emailing [email protected] or by calling David Crapo at Gibbons P.C., tel. no. (973) 596-4589.

A: The Receivership was established with the consent of the individual defendants in the civil enforcement case brought by the Securities and Exchange Commission titled SEC v. Mediatrix Capital, Inc., et al., case No. 19-cv-2594 (D. Colo.) (RM) in order to preserve and manage the assets subject to the Asset Freeze Order. Unlike the criminal trial, the Receivership is a civil action which will, at a certain point, be resolved before the District Court. The Receiver’s role is to administer the Receivership estate. The Receiver is not involved in either the prosecution of the criminal case by the Department of Justice or the advancement of the civil litigation by the SEC. The Receiver will continue his work as ordered by the Court, and will continue to provide updates on his progress.

A: Recent failures in the banking industry have had no impact on the Receivership estate. No Receivership funds are held at Silicon Valley Bank, Signature Bank or First Republic Bank. As of May 11, 2023, the Receivership has funds held at three different banks, with the vast majority of the Receivership funds held at a bank that is considered a “systemically important bank.” Of the approximately $24 million held by the Receiver at the systemically important bank, approximately $23.5 million is currently invested in United States Treasury Bills. Pursuant to the Court’s Order Granting Motion of Receiver for an Order Authorizing Receiver to Invest Receivership Funds, the Receiver continues to hold at least $500,000 in cash. The Receiver continues to monitor his banking relationships.