(CN) – The 5th Circuit upheld a civil contempt order against an attorney who helped his client evade an asset freeze by selling a Picasso painting for $431,161.
Jeffrey Bruteyn hired attorney Phillip Offill Jr. to defend him in a securities fraud lawsuit filed by the Securities and Exchange Commission. The same day the SEC filed suit, the district court issued a temporary restraining order freezing Bruteyn’s assets.
Bruteyn and several business associates and friends met at Offill’s office to discuss how Bruteyn would access money for living expenses and legal costs.
Bruteyn proposed selling a Picasso painting hanging in his bedroom to United Financial. Offill initially opposed the plan, but later said it would be legal because the painting was owned by Bruteyn’s mother, Lois Whitcraft.
Bruteyn called his mother and received her permission to sell the painting. The money was wired into Whitcraft’s account for her son’s use.
A federal judge found Bruteyn, Offill and Whitcraft in contempt of court for violating the freeze order.
Offill and Whitcraft appealed.
A three-judge panel of the federal appeals court in New Orleans agreed that Offill, as Bruteyn’s attorney, had violated the order.
“Offill – with full knowledge of the freeze order’s terms – was an active participant in discussions about how to get funds to Bruteyn, approved of the sale of the Picasso, and Offill’s office served as the place to consummate the deal,” Judge Benavides wrote.
But the court reversed the contempt finding against Whitcraft, finding a lack of evidence that she knew the details of the freeze order.