Investors sought the appointment of an investigative receiver over the defendant’s assets after transferring $3 million for foreign currency trading and alleging misappropriation and fraud when funds were not returned.
The defendant opposed the request and moved to set aside a default judgment previously granted against him.
The court held that although the defendant had not fully explained what happened to all funds during examinations and productions, the extraordinary remedy of appointing an investigative receiver before trial was not justified.
Existing discovery mechanisms and potential procedural sanctions were sufficient to address any non‑compliance.
The default judgment was set aside on consent, and the court directed the action to proceed to an expedited hybrid trial to determine liability and the disposition of the invested funds.
