                                                          FILED
                                               United States Court of Appeals
                                                       Tenth Circuit

                                                    October 28, 2011
                UNITED STATES COURT OF APPEALS
                                             Elisabeth A. Shumaker
                                                      Clerk of Court
                       FOR THE TENTH CIRCUIT


U.S. COMMODITY FUTURES
TRADING COMMISSION;
OKLAHOMA DEPARTMENT OF
SECURITIES ex rel. IRVING L.
FAUGHT,

           Plaintiffs-Appellees,
                                            No. 10-6276
v.                                   (D.C. No. 5:09-CV-01284-R)
                                            (W.D. Okla.)
KENNETH WAYNE LEE, an
individual; DARREN LEE, an
individual; SHEILA M. LEE, an
individual; DAVID A. LEE, an
individual,

           Defendants-Appellants,

and

PRESTIGE VENTURES CORP., a
Panamanian corporation;
FEDERATED MANAGEMENT
GROUP, INC., a Texas corporation;
SIMON YANG, an individual, a/k/a
Xiao Yang, a/k/a Simon Chen,

          Defendants,
____________________________

STEPHEN J. MORIARTY,

          Receiver.
____________________________

COMMODITY FUTURES TRADING
COMMISSION; OKLAHOMA
    DEPARTMENT OF SECURITIES ex
    rel. IRVING L. FAUGHT,

               Plaintiffs-Appellees,
                                                       No. 10-6287
    v.                                          (D.C. No. 5:09-CV-01284-R)
                                                       (W.D. Okla.)
    SIMON YANG, an individual, a/k/a
    Xiao Yang, a/k/a Simon Chen,

               Defendant-Appellant,

    and

    PRESTIGE VENTURES CORP., a
    Panamanian corporation;
    FEDERATED MANAGEMENT
    GROUP, INC., a Texas corporation;
    KENNETH WAYNE LEE, an
    individual; DARREN LEE, an
    individual; SHEILA M. LEE, an
    individual; DAVID A. LEE, an
    individual,

              Defendants.
    ________________________

    STEPHEN J. MORIARTY,

               Receiver.


                           ORDER AND JUDGMENT *

*
       After examining the briefs and appellate record, this panel has determined
unanimously that oral argument would not materially assist the determination of
this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is
therefore ordered submitted without oral argument. This order and judgment is
not binding precedent, except under the doctrines of law of the case, res judicata,
                                                                       (continued...)

                                         -2-
Before LUCERO, BALDOCK, and TYMKOVICH, Circuit Judges.



      This is a civil action brought by the United States Commodity Futures

Trading Commission (CFTC) and the Oklahoma Department of Securities. The

defendants named in the action included two individuals, Kenneth Lee and Simon

Yang, and two corporate defendants that Mr. Lee operated (collectively referred

to as “Prestige”). Also included as parties were Mr. Lee’s wife, Sheila, and their

two adult sons, David Lee and Darren Lee, who were named in the first amended

complaint as “relief defendants” (and who, together with Kenneth Lee, we refer to

herein as the “Lees”). 1

      The Lees and Mr. Yang appeal pro se from the district court’s orders

adjudicating liability and granting relief in favor of the plaintiffs. Case No.

10-6276 is the Lees’ appeal, and Case No. 10-6287 is Mr. Yang’s. We have

consolidated these appeals for purposes of disposition. We have jurisdiction, see

28 U.S.C. § 1291, and we affirm the challenged orders of the district court.



*
 (...continued)
and collateral estoppel. It may be cited, however, for its persuasive value
consistent with Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.
1
       A “relief defendant” (a.k.a. “nominal defendant”) “is a person who can be
joined to aid the recovery of relief without an assertion of subject matter
jurisdiction only because he has no ownership interest in the property which is the
subject of litigation.” SEC v. Cherif, 933 F.2d 403, 414 (7th Cir. 1991).

                                         -3-
                                   BACKGROUND

         In their complaint, plaintiffs alleged that defendants operated a Ponzi

scheme that bilked at least 140 investors out of millions of dollars, in violation of

a number of provisions of the Commodity Exchange Act, 7 U.S.C. §§ 1-27f

(“CEA”), and the Oklahoma Uniform Securities Act of 2004 (“OUSA”). The

investors were primarily members of Oklahoma City’s ethnic Chinese community.

Plaintiffs also alleged that millions of dollars were funneled to the relief

defendants from Prestige by Mr. Lee, in cash and in the form of houses, cars, and

boats.

         The corporate defendants never answered the amended complaint.

Mr. Yang and the Lees answered and proceeded pro se.

         The district court established a receivership and entered a statutory

restraining order that, among other things, froze the assets of defendants, the

relief defendants, and any persons in active concert with them. Plaintiffs

subsequently moved for summary judgment against defendants and the relief

defendants. The defendants did not oppose the motion. On October 27, 2010, the

court entered a detailed order granting the summary judgment motion in all

respects. The court found that defendants had violated a number of provisions of

the CEA and the OUSA. The court also found that judgment against the relief

defendants was proper, as they had received investor funds from Prestige to which

they had no legitimate claim.

                                           -4-
      The court set the matter for a November 8, 2010, bench trial on damages

and penalties. Darren Lee moved for a continuance based on plaintiffs’ alleged

failure to comply with discovery requests, but the court denied the motion on

several grounds: he did not indicate he was going to file a motion to compel

discovery; any such motion would be untimely because discovery had closed

more than one month prior; and he did not state when, if ever, he anticipated

being ready for trial.

      Of the defendants and relief defendants, only Mr. Yang appeared, pro se, at

the trial. On November 29, 2010, the court entered a detailed order (“Relief

Order”) regarding sums received by defendants from investors between 2003 and

2009. The court found that Prestige had received at least $10,656,921 from

investors and returned $3,357,732 to them. The court also found that Prestige had

received $469,507 from Mr. Yang and disbursed $133,500 to him; $17,108 from

Mrs. Lee and disbursed $728,953 to her or for her benefit; $190 from David Lee

and disbursed $574,464 to him or for his benefit; and $15,162 from Darren Lee

and disbursed $654,101 to him or for his benefit. The court further found that

two houses were purchased with investor funds received by Prestige and were

Prestige assets. One of those houses was occupied by Mr. Lee and his wife and

the other was Darren Lee’s residence. The court also found that a boat registered

to the two brothers was similarly purchased with investor funds.




                                        -5-
      Based on these findings, the court authorized the receiver to take

possession of and sell the two houses and the boat, giving the Lees twenty days to

vacate the houses. The court also entered a broad array of permanent injunctive

orders prohibiting defendants from further dealings in commodity futures and

transacting investment-related business in Oklahoma. The court further ordered

defendants to pay over $5 million in restitution and a number of penalties, and

ordered the relief defendants to disgorge large sums of cash.

      Each of the Lees filed a substantively identical motion for reconsideration

of the Relief Order on December 8, 2010. The Lees subsequently filed a notice of

appeal from the district court’s final judgment, which became this court’s Case

No. 10-6276. Yang filed a notice of appeal from the judgment, which became

this court’s Case No. 10-6287. The district court then denied the motions for

reconsideration, ripening the previously-filed notices of appeal. See Fed. R. App.

P. 4(a)(4)(B)(i).

                           STANDARD OF REVIEW

            We review the district court’s grant of summary judgment de
      novo, viewing the evidence in the light most favorable to the
      non-moving party. Summary judgment is appropriate when there is
      no genuine issue of material fact and the movant is entitled to
      judgment as a matter of law. We may affirm on any basis supported
      by the record, even though not relied on by the district court.




                                        -6-
McCarty v. Gilchrist, 646 F.3d 1281, 1284-85 (10th Cir. 2011) (quotation,

citations, and alteration omitted). 2 “In an appeal from a bench trial, we review

the district court’s factual findings for clear error and its legal conclusions de

novo.” Keys Youth Svcs., Inc. v. City of Olathe, Kan., 248 F.3d 1267, 1274

(10th Cir. 2001). We review the district court’s issuance of a permanent

injunction for an abuse of discretion. Southwest Stainless, L.P. v. Sappington,

582 F.3d 1176, 1191 (10th Cir. 2009).



2
       Plaintiffs contend that the Lees are barred from pursuing any issues
involving the district court’s interlocutory order of summary judgment, which
adjudicated their liability but did not specify relief. Plaintiffs argue that the Lees
appealed only from the Relief Order, but have failed to raise any issues on appeal
relating to that order. The Lees’ notice of appeal stated that they appealed “from
the final Judgment in this action entered on November 29, 2010.” R., Vol.1 at
1582. On November 29, 2010, the district court entered two documents: the
Relief Order adjudicating the issues concerning relief, and a separate judgment
that simply stated “In accordance with the Court’s order dated this same day,
judgment is hereby entered in favor of the Plaintiffs.” Id. at 1537. As we read
the district court’s separate judgment of November 29, 2010, it was intended as a
final judgment in this case. And as we read the Lees’ notice of appeal, it was
intended to appeal from this final judgment.
       “[A] notice of appeal which names the final judgment is sufficient to
support review of all earlier orders that merge in the final judgment.” McBride v.
CITGO Petroleum Corp., 281 F.3d 1099, 1104 (10th Cir. 2002). “[I]t is a general
rule that all earlier interlocutory orders merge into final orders and judgments
except when the final order is a dismissal for failure to prosecute.” Id. (citing
16A Wright & Miller, Federal Practice & Procedure § 3949.4 (3d ed. 1999 &
Supp. 2001)). Through an appeal of a final judgment, a party can obtain appellate
review of both the final judgment and any interlocutory orders. We therefore
have jurisdiction over the appellants’ challenges, to the extent they attack both
the summary judgment order and the Relief Order.



                                          -7-
                                   DISPOSITION

       In No. 10-6276, the Lees present the following arguments: (1) the district

court denied them due process throughout the adjudicatory process; (2) they were

improperly deprived of adequate discovery; and (3) the district court lacked

personal jurisdiction over them in Oklahoma.

       In No. 10-6287, Mr. Yang presents the following arguments: (1) the

district court’s order of summary judgment is based on “false statements and

twisted facts” presented by plaintiffs and ignores the defendants’ evidence and

facts, Aplt. Opening Br. at 3; (2) the investors’ losses were due to a cash crunch

and margin calls rather than the collapse of a Ponzi scheme as alleged by the

plaintiffs; (3) the summary judgment order contains numerous misstatements; and

(4) the district court should have granted Mr. Yang’s motion for damages from

the plaintiffs.

       Having considered these issues and having reviewed the briefs, the record,

and the applicable law in light of the applicable review standards, we AFFIRM

the judgment of the district court for substantially the reasons stated in the district

court’s order of summary judgment dated October 27, 2010, and its Relief Order

of November 29, 2010.




                                          -8-
                                CONCLUSION

      The judgment of the district court is AFFIRMED. We GRANT the Lees’

motions to proceed in forma pauperis. We GRANT in part and DENY in part

plaintiffs’ motion to strike portions of the Lees’ reply brief. Specifically, we

GRANT the motion to the extent it seeks to strike exhibits D and F and the

portions of exhibit G to the Lees’ reply brief that were not part of the district

court record, but DENY the remainder of the motion.


                                                     Entered for the Court



                                                     Bobby R. Baldock
                                                     Circuit Judge




                                         -9-
