United States District Court, Central District of California
The District Court in Los Angeles granted final approval of one of the largest settlements in United States history against an indenture trustee. Mark Molumphy served as Co-Lead Counsel for investors in Medical Capital, a medical receivables company based in Tustin, California. Wells Fargo and Bank of New York Mellon served as indenture trustees for investors, responsible for administering trust accounts where the investor funds were deposited. Medical Capital turned out to be a massive Ponzi scheme; the plaintiffs alleged the banks breached their duties under the trust agreements and disbursed hundreds of millions of dollars to Medical Capital. Wells Fargo agreed to pay $105 million and Bank of New York Mellon agreed to pay $114 million to resolve the actions.
