FILED
Nov 21 2016
United States District Court
Northern District of Ohio
General Order
GENERAL ORDER NO. 2016-25
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF OHIO
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ORDER REGARDING DEPOSIT AND ) ORDER NO. 2016-25
INVESTMENT OF REGISTRY FUNDS )
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As the Court has determined that it is necessary to adopt local procedures to ensure
uniformity in the deposit, investment, and tax administration of funds in the Court’s
Registry,
IT IS ORDERED that the following shall govern the receipt, deposit, and investment of
registry funds:
I. Receipt of Funds
A. No money shall be sent to the Court or its officers for deposit in the Court’s
registry without a court order signed by the presiding judge in the case or
proceeding.
B. The party making the deposit or transferring funds to the Court’s registry shall
serve the order permitting the deposit or transfer on the Clerk of Court.
C. Unless provided for elsewhere in this Order, all monies ordered to be paid to the
Court or received by its officers in any case pending or adjudicated shall be
deposited with the Treasurer of the United States in the name and to the credit of
this Court pursuant to 28 U.S.C. ' 2041 through depositories designated by the
Treasury to accept such deposit on its behalf.
II. Investment of Registry Funds
A. Where, by order of the Court, funds on deposit with the Court are to be placed in
some form of interest-bearing account or invested in a court-approved,
interest-bearing instrument in accordance with Rule 67 of the Federal Rules of
Civil Procedure, the Court Registry Investment System (“CRIS”), administered by
the Administrative Office of the United States Courts under 28 U.S.C. ' 2045,
shall be the only investment mechanism authorized.
B. Interpleader funds deposited under 28 U.S.C. ' 1335 meet the IRS definition of a
ADisputed Ownership Fund@ (DOF), a taxable entity that requires tax
administration. Unless otherwise ordered by the court, interpleader funds shall
be deposited in the DOF established within the CRIS and administered by the
Administrative Office of the United States Courts, which shall be responsible for
meeting all DOF tax administration requirements.
C. The Director of Administrative Office of the United States Courts is designated
as custodian for all CRIS funds. The Director or the Director=s designee shall
perform the duties of custodian. Funds held in the CRIS remain subject to the
control and jurisdiction of the Court.
D. Money from each case deposited in the CRIS shall be Apooled@ together with
those on deposit with Treasury to the credit of other courts in the CRIS and used
to purchase Government Account Series securities through the Bureau of Public
Debt, which will be held at Treasury, in an account in the name and to the credit
of the Director of Administrative Office of the United States Courts. The pooled
funds will be invested in accordance with the principles of the CRIS Investment
Policy as approved by the Registry Monitoring Group.
E. An account will be established in the CRIS Liquidity Fund titled in the name of
the case giving rise to the deposit invested in the fund. Income generated from
fund investments will be distributed to each case based on the ratio each
account=s principal and earnings has to the aggregate principal and income total
in the fund after the CRIS fee has been applied. Reports showing the interest
earned and the principal amounts contributed in each case will be prepared and
distributed to each court participating in the CRIS and made available to litigants
and/or their counsel.
F. For each interpleader case, an account shall be established in the CRIS
Disputed Ownership Fund, titled in the name of the case giving rise to the
deposit invested in the fund. Income generated from fund investments will be
distributed to each case after the DOF fee has been applied and tax withholdings
have been deducted from the fund. Reports showing the interest earned and the
principal amounts contributed in each case will be available through the
FedInvest/CMS application for each court participating in the CRIS and made
available to litigants and/or their counsel. On appointment of an administrator
authorized to incur expenses on behalf of the DOF in a case, the case DOF
funds should be transferred to another investment account as directed by court
order.
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III. Fees and Taxes
A. The custodian is authorized and directed by this Order to deduct the CRIS fee of
an annualized 10 basis points on assets on deposit for all CRIS funds, excluding
the case funds held in the DOF, for the management of investments in the CRIS.
According to the Court’s Miscellaneous Fee Schedule, the CRIS fee is assessed
from interest earnings to the pool before a pro rata distribution of earnings is
made to court cases.
B. The custodian is authorized and directed by this Order to deduct the DOF fee of
an annualized 20 basis points on assets on deposit in the DOF for management
of investments and tax administration. According to the Court’s Miscellaneous
Fee Schedule, the DOF fee is assessed from interest earnings to the pool before
a pro rata distribution of earnings is made to court cases. The custodian is
further authorized and directed by this Order to withhold and pay federal taxes
due on behalf of the DOF.
IV. Transition from Former Investment Procedure
A. The Clerk of Court is further directed to develop a systematic method of
redemption of all existing investments and their transfer to the CRIS.
B. Deposits to the CRIS DOF will not be transferred from any existing CRIS Funds.
Only new deposits pursuant to 28 U.S.C. ' 1335 from the effective date of this
order will be placed in the CRIS DOF.
C. Parties not wishing to transfer certain existing registry deposits into the CRIS
may seek leave to transfer them to the litigants or their designees on proper
motion and approval of the judge assigned to the specific case.
D. This Order supersedes and abrogates all prior orders of this Court regarding the
deposit and investment of registry funds.
E. The effective date of this order is the date the CRIS DOF begins accepting
deposits.
IT IS SO ORDERED.
FOR THE COURT
Solomon Oliver, Jr.
Chief Judge
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