BULLETIN: Proposed Class-Action Against Zeek In Louisiana Transferred To North Carolina

BULLETIN: A federal judge has transferred from the Eastern District of Louisiana to the Western District of North Carolina a proposed class-action lawsuit against Rex Venture Group LLC, Zeek Rewards and Paul R. Burks.

The ruling by U.S. District Judge Carl J. Barbier  in New Orleans likely paves the way for Senior U.S. District Judge Graham C. Mullen of Charlotte to issue a specific order to stay the case. Both Burks and Kenneth D. Bell, the court-appointed receiver in the Zeek Ponzi scheme case brought by the SEC on Aug. 17 in Mullen’s courtroom, have sought the stay.

In August, Mullen issued an order that “[a]ll Ancillary Proceedings are stayed in their entirety, and all Courts having any jurisdiction thereof are enjoined from taking or permitting any action under further Order of this Court. . . .”

The prospective class action was filed in Louisiana on Aug. 24, a week after Mullen issued the stay in North Carolina.

Burks has contended that the Louisiana plaintiffs tried to circumvent the Aug. 17 stay issued by Mullen by bringing an action in another federal district.

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6 Responses to “BULLETIN: Proposed Class-Action Against Zeek In Louisiana Transferred To North Carolina”

  1. Thanks for the post. The wheels of justice move slowly but in the right direction. Give it up profiteers and less settle this deceitful mess. Yeshua (Messiah) warned us about the love of money.

  2. I noticed this has been filed:

    Case Number: 4:2012mc00024
    Filed: December 5, 2012

    Court: Arkansas Western District Court
    Office: Texarkana Office
    County: U.S., Outside State
    Presiding Judge: Susan O. Hickey

    I don’t have access to PACER so I don’t know the details.

  3. And another one, this time Arizona:

    Case Number: 2:2012mc00118
    Filed: December 5, 2012

    Court: Arizona District Court
    Office: Phoenix Division Office
    County: XX US, Outside State

  4. Hi Tony,

    Thanks for these. This appears to be the Zeek receiver filing formal notice in other federal districts about the SEC action/receivership in the Western District of North Carolina and that the receiver will be operating in multiple federal districts.

    On Dec. 3, Senior Judge Mullen — who is presiding over the Zeek case from the Western District of North Carolina — issued an order reappointing the receiver.

    This was because the receiver notified the court that he has been “tracing funds relating to this case and believes he may have identified causes of action and other potential receivership assets located in and held by individuals located in other federal districts.”

    Judge Mullen wrote: “In order to comply with the requirements of 28 U.S.C. § 754 and to confer jurisdiction upon this Court regardless of the location of the receivership assets or the individuals possessing those assets, the Receiver has filed a Motion for Order Reappointing Receiver seeking reappointment on the same terms currently in place. The Court, having carefully considered the Motion and relevant case law, concludes that the Motion should be granted.”

    One effect of Judge Mullen’s order is that it likely will cause wing-and-a-prayer challenges to subpoenas the receiver issues outside of the N.C. Western District to diminish or go away, thus saving money for the receivership.

    It looks as though the receiver also has filed in Minnesota and Vermont, meaning he believes receivership assets that potentially can be attached reside in those states. Other states likely will follow, given the enormous scope of this case.


  5. Don has the files on his site and reports that most likely Ken Bell is filing those to get jurisdiction over property in other federal court districts. More clawbacks to follow.


  6. […] Blog reader “Tony” posted comments this morning about cases involving Rex Venture Group LLC popping up in federal courts beyond the Western […]