Fed. Sec. L. Rep. P 91,679 Securities and Exchange Commission v. Walter Wencke, Palmer York, Jr. And George Croke, and Real Parties in Interest

FLETCHER, Circuit Judge:

Palmer York, Jr. and George E. Croke appeal the district court’s refusal to lift its stay preventing the commencement of their suit against the Wencke receivership. We reverse.

In 1982, Portsmouth Square, Inc. (PSI) sought to remedy its serious financial difficulties by making a deal with Walker Wencke, a self-proclaimed expert on saving financially troubled companies. Wencke, through his company RAMAPO, concluded an agreement with PSI pursuant to which PSI received $10,000 and an implied promise of Wencke’s services in exchange for stock representing a controlling…