USFIA trial back on for January 10th?
Following a scathing summary judgement decision that saw USFIA labelled a Ponzi scheme and Steve Chen the scammer who operated it, the SEC’s case against USFIA seemed all but over.
Despite effectively losing the case, Steve Chen is still fighting it out to the bitter end.
The point of contention between Chen and the SEC appears to be how much Chen will pay in damages.
The granting of summary judgement saw Chen ordered to pay a ‘civil penalty, including disgorgement of ill-gotten gains and prejudgement interest‘.
On December 19th a pre-trial conference was held before Judge Klausner.
It appears Chen asked for the summary judgement order to be vacated, with minutes for hearing recording ‘the Court will not vacate Order on Motion for Summary Judgment‘.
Judge Klausner ordered settlement negotiations between Chen and the SEC for a few hours, with the issues unresolved as of later that day.
Case recalled. The Court and counsel confer. Settlement was not reached.
Jury Trial shall remain on calendar for January 10, 2017 at 9:00 a.m.
Counsel shall file aw witness list pertaining to the issue of damages only.
I’ve bolded the part that suggests all that’s left to decide is damages. Whether USFIA was a Ponzi scheme and Steve Chen a scammer doesn’t appear to be under contention (as evidenced by the summary judgement order standing).
Given how adamant Chen was that he hadn’t scammed anyone until Judge Klausner shut him down with summary judgement, I’m guessing he still thinks he’s going to keep some of his ill-gotten gains.
What with the tone of Judge Klausner’s summary judgement order, Chen’s probably shot himself in the foot over this one. I don’t think it’s going to go well for him on January 10th.
Footnote: Our thanks to Don@ASDUpdates for providing a copy of the minutes of the pre-trial conference (filed December 19th).
Update 24th December 2016 – Whether the January 10th trial will go ahead is unclear. Chen is fighting with the SEC over who will decide monetary damages.