Post by kenshin7 on Sept 5, 2009 9:33:29 GMT -5
UNITED STATES DISTRICT COURT DISTRICT OF NEVADA
SECURITIES AND EXCHANGE COMMISSION,
Plaintiff,
vs.
CMKM DIAMONDS, INC., URBAN CASAVANT, JOHN EDWARDS,
GINGER GUTIERREZ, JAMES KINNEY, ANTHONY TOMASSO,
KATHLEEN TOMASSO, 1ST GLOBAL STOCK TRANSFER, LLC,
HELEN BAGLEY, NEVWEST SECURITIES CORPORATION, DARYL ANDERSON, SERGEY RUMYANTSEV, ANTHONY
SANTOS, and BRIAN DVORAK, Defendants.
Case No.: 2:08-cv-00437-LRH-RJJ
FINAL JUDGMENT OF PERMANENT INJUNCTION AND OTHER RELIEF AGAINST DEFENDANT URBAN CASAVANT
Pursuant to Rule 55 of the Federal Rules of Civil Procedure, the Application of Plaintiff Securities and Exchange Commission for Entry of Default Judgment Against Defendant Urban Casavant came before this Court. The Court, having considered all evidence and argument in connection with the Application, enters the following Final Judgment:
I.
IT IS HEREBY ORDERED, ADJUDGED AND DECREED that the
Securities and Exchange Commission's Application for Entry of Default Judgment Against Defendant Urban Casavant is GRANTED.
II.
IT IS ORDERED, ADJUDGED, AND DECREED that Casavant and his agents, servants, employees, attorneys, and all persons in active concert or participation with them who receive actual notice of this Final Judgment by personal service or otherwise are permanently restrained and enjoined from violating, directly or indirectly, Section 10(b) of the Securities Exchange Act of 1934 (the "Exchange Act"), 15 U.S.C. § 78j(b), and Rule 10b-5 promulgated thereunder, 17 C.F.R. § 240.10b-5, by using any means or instrumentality of interstate commerce, or of the mails, or of any facility of any national securities exchange, in connection with the purchase or sale of any security:
(a) to employ any device, scheme, or artifice to defraud;
(b) to make any untrue statement of a material fact or to omit to state a
material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading; or
(c) to engage in any act, practice, or course of business which operates or
would operate as a fraud or deceit upon any person.
III.
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that Casavant
and his agents, servants, employees, attorneys, and all persons in active concert or participation with them who receive actual notice of this Final Judgment by personal service or otherwise are permanently restrained and enjoined from violating Section 17(a) of the Securities Act of 1933 (the "Securities Act"), 15 U.S.C. § 77q(a), in the offer or sale of any security by the use of any means or instruments of transportation or communication in interstate commerce or by use of the mails, directly or indirectly:
(a) to employ any device, scheme, or artifice to defraud;
(b) to obtain money or property by means of any untrue statement of a material fact or any omission of a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading; or
(c) to engage in any transaction, practice, or course of business which operates or would operate as a fraud or deceit upon the purchaser.
IV.
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that Casavant
and his agents, servants, employees, attorneys, and all persons in active concert or participation with them who receive actual notice of this Final Judgment by personal service or otherwise are permanently restrained and enjoined from violating Section 5 of the Securities Act, 15 U.S.C. § 77e, by, directly or indirectly, in the absence of any applicable exemption:
(a) Unless a registration statement is in effect as to a security, making use of any means or instruments of transportation or communication in interstate commerce or of the mails to sell such security through the use or medium of any prospectus or otherwise;
(b) Unless a registration statement is in effect as to a security, carrying or causing to be carried through the mails or in interstate commerce, by any means or instruments of transportation, any such security for the
purpose of sale or for delivery after sale; or (c) Making use of any means or instruments of transportation or
communication in interstate commerce or of the mails to offer to sell or offer to buy through the use or medium of any prospectus or otherwise any security, unless a registration statement has been filed with the Commission as to such security, or while the registration statement is the subject of a refusal order or stop order or (prior to the effective date of the registration statement) any public proceeding or examination under Section 8 of the Securities Act, 15 U.S.C. § 77h.
V.
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that Casavant and his agents, servants, employees, attorneys, and all persons in active concert or participation with them who receive actual notice of this Final Judgment by personal service or otherwise are permanently restrained and enjoined from aiding and abetting any violation of Section 13(a) of the Exchange Act, 15 U.S.C. § 78m(a), and Rules 13a-1 and 13a-13 thereunder, 17 C.F.R. §§ 240.13a-1 & 240.13a-13, by knowingly providing substantial assistance to an issuer in filing with the Commission required periodic reports, which fail to include material information necessary to make the required statements, in light of the circumstances under which they are made, not misleading.
VI.
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that Casavant and his agents, servants, employees, attorneys, and all persons in active concert or participation with them who receive actual notice of this Final Judgment by personal service or otherwise are permanently restrained and enjoined from aiding and abetting any violation of Section 13(b)(2)(A) of the Exchange Act, 15 U.S.C. § 78m(b)(2)(A), and violating Rule 13b2-1 thereunder, 17 C.F.R. § 240.13b2-1, by knowingly providing substantial assistance to an issuer that failed to make an keep
books, records, and accounts, which, in reasonable detail, accurately and fairly reflect the transactions and disposition of the assets of the issuer.
VII.
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that Casavant
and his agents, servants, employees, attorneys, and all persons in active concert or participation with them who receive actual notice of this Final Judgment by personal service or otherwise are permanently restrained and enjoined from aiding and abetting any violation of Sections 13(b)(2)(B) of the Exchange Act, 15 U.S.C. § 78m(b)(2)(B), by knowingly providing substantial assistance to an issuer which has a class of securities registered pursuant to Section 12 of the Exchange Act, 15 U.S.C. § 78/, or that is required to file reports pursuant to Section 15(d) of the Exchange Act, 15 U.S.C. § 78o(d), in failing to devise and maintain a sufficient system of internal accounting controls sufficient to provide reasonable assurances that:
a. transactions are executed in accordance with management's general
or specific authorization;
b. transactions are recorded as necessary (i) to permit preparation of
financial statements in conformity with generally accepted
accounting principles or any other criteria applicable to such
statements, and (ii) to maintain accountability for assets;
c. access to assets is permitted only in accordance with management's
general or specific authorization; and
d. the recorded accountability for assets is compared with the existing
assets at reasonable intervals and appropriate action is take with
respect to any differences.
VIII.
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, pursuant to Section 21(d)(2) of the Exchange Act, 15 U.S.C. § 78u(d)(2), and
Section 20(e) of the Securities Act, 15 U.S.C. § 77t(e), Casavant is prohibited from acting as an officer or director of any issuer that has a class of securities registered pursuant to Section 12 of the Exchange Act, 15 U.S.C. § 78/, or that is required to file reports pursuant to Section 15(d) of the Exchange Act, 15 U.S.C. § 78o(d).
IX.
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that
Casavant is permanently barred from participating in an offering of penny stock, including engaging in activities with a broker, dealer, or issuer for purposes of issuing, trading, or inducing or attempting to induce the purchase or sale of any penny stock. A penny stock is any equity security that has a price of less than five dollars, except as provided in Rule 3a51-1 under the Exchange Act, 17 C.F.R. §
240.3a51-1.
X.
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that
Casavant is liable for disgorgement of $31,500,000, representing profits gained as
a result of the conduct alleged in the Complaint, together with prejudgment interest
thereon in the amount of $2,689,433.62, and a civil penalty in the amount of
$31,500,000 pursuant to Section 20(d) of thh Securities Act, 15 U. S.C. Cection 77t(d), and
Section 21(d)(3) of the Exchange Act, 15 U.S.C. 78u(d)(3). Casavant shall satisfy this obligation by paying $34,689,433.62 within ten business days to the Clerk of this Court, together with a cover letter identifying Casavant as a defendant in this action; setting forth the title and civil action number of this action and the name of this Court; and specifying that payment is made pursuant to this Final Judgment. Casavant shall simultaneously transmit photocopies of such payment and letter to the Commission's counsel in this action. By making this payment, Casavant relinquishes all legal and equitable right, title, and interest in such funds, and no part of the funds shall be returned to Casavant. Casavant shall pay post-judgment interest on any delinquent amounts pursuant to 28 U.S.C. § 1961.
The Clerk shall deposit the funds into an interest bearing account with the Court Registry Investment System ("CRIS") or any other type of interest bearing account that is utilized by the Court. These funds, together with any interest and income earned thereon (collectively, the "Fund"), shall be held in the interest bearing account until further order of the Court. In accordance with 28 U.S.C. § 1914 and the guidelines set by the Director of the Administrative Office of the United States Courts, the Clerk is directed, without further order of this Court, to deduct from the income earned on the money in the Fund a fee equal to ten percent of the income earned on the Fund. Such fee shall not exceed that authorized by the Judicial Conference of the United States.
The Commission may by motion propose a plan to distribute the Fund subject to the Court's approval. Such a plan may provide that the Fund shall be distributed pursuant to the Fair Fund provisions of Section 308(a) of the Sarbanes-Oxley Act of 2002. Regardless of whether any such Fair Fund distribution is made, amounts ordered to be paid as civil penalties pursuant to this Judgment shall be treated as penalties paid to the government for all purposes, including all tax purposes. To preserve the deterrent effect of the civil penalty, Casavant shall not, after offset or reduction of any award of compensatory damages in any Related Investor Action based on Casavant's payment of disgorgement in this action, argue that he is entitled to, nor shall he further benefit by, offset or reduction of such compensatory damages award by the amount of any part of Casavant's payment of a civil penalty in this action ("Penalty Offset"). If the court in any Related Investor Action grants such a Penalty Offset, Casavant shall, within 30 days after entry of a final order granting the Penalty Offset, notify the Commission's counsel in this action and pay the amount of the Penalty Offset to the United States Treasury or to a Fair Fund, as the Commission directs. Such a payment shall not be deemed an additional civil penalty and shall not be deemed to change the amount of the civil penalty imposed in this Judgment. For purposes of this paragraph, a "Related
Investor Action" means a private damages action brought against Casavant by or on behalf of one or more investors based on substantially the same facts as alleged in the Complaint in this action.
XI.
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that this Court shall retain jurisdiction of this matter for the purposes of enforcing the terms of this Final Judgment.
X.
There being no just reason for delay, pursuant to Rule 54(b) of the Federal Rules of Civil Procedure, the Clerk is ordered to enter this Final Judgment forthwith and without further notice.
DATED this 2nd day of September, 2009.
LARRY R. HICKS
UNITED STATES DISTRICT JUDGE
SECURITIES AND EXCHANGE COMMISSION,
Plaintiff,
vs.
CMKM DIAMONDS, INC., URBAN CASAVANT, JOHN EDWARDS,
GINGER GUTIERREZ, JAMES KINNEY, ANTHONY TOMASSO,
KATHLEEN TOMASSO, 1ST GLOBAL STOCK TRANSFER, LLC,
HELEN BAGLEY, NEVWEST SECURITIES CORPORATION, DARYL ANDERSON, SERGEY RUMYANTSEV, ANTHONY
SANTOS, and BRIAN DVORAK, Defendants.
Case No.: 2:08-cv-00437-LRH-RJJ
FINAL JUDGMENT OF PERMANENT INJUNCTION AND OTHER RELIEF AGAINST DEFENDANT URBAN CASAVANT
Pursuant to Rule 55 of the Federal Rules of Civil Procedure, the Application of Plaintiff Securities and Exchange Commission for Entry of Default Judgment Against Defendant Urban Casavant came before this Court. The Court, having considered all evidence and argument in connection with the Application, enters the following Final Judgment:
I.
IT IS HEREBY ORDERED, ADJUDGED AND DECREED that the
Securities and Exchange Commission's Application for Entry of Default Judgment Against Defendant Urban Casavant is GRANTED.
II.
IT IS ORDERED, ADJUDGED, AND DECREED that Casavant and his agents, servants, employees, attorneys, and all persons in active concert or participation with them who receive actual notice of this Final Judgment by personal service or otherwise are permanently restrained and enjoined from violating, directly or indirectly, Section 10(b) of the Securities Exchange Act of 1934 (the "Exchange Act"), 15 U.S.C. § 78j(b), and Rule 10b-5 promulgated thereunder, 17 C.F.R. § 240.10b-5, by using any means or instrumentality of interstate commerce, or of the mails, or of any facility of any national securities exchange, in connection with the purchase or sale of any security:
(a) to employ any device, scheme, or artifice to defraud;
(b) to make any untrue statement of a material fact or to omit to state a
material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading; or
(c) to engage in any act, practice, or course of business which operates or
would operate as a fraud or deceit upon any person.
III.
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that Casavant
and his agents, servants, employees, attorneys, and all persons in active concert or participation with them who receive actual notice of this Final Judgment by personal service or otherwise are permanently restrained and enjoined from violating Section 17(a) of the Securities Act of 1933 (the "Securities Act"), 15 U.S.C. § 77q(a), in the offer or sale of any security by the use of any means or instruments of transportation or communication in interstate commerce or by use of the mails, directly or indirectly:
(a) to employ any device, scheme, or artifice to defraud;
(b) to obtain money or property by means of any untrue statement of a material fact or any omission of a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading; or
(c) to engage in any transaction, practice, or course of business which operates or would operate as a fraud or deceit upon the purchaser.
IV.
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that Casavant
and his agents, servants, employees, attorneys, and all persons in active concert or participation with them who receive actual notice of this Final Judgment by personal service or otherwise are permanently restrained and enjoined from violating Section 5 of the Securities Act, 15 U.S.C. § 77e, by, directly or indirectly, in the absence of any applicable exemption:
(a) Unless a registration statement is in effect as to a security, making use of any means or instruments of transportation or communication in interstate commerce or of the mails to sell such security through the use or medium of any prospectus or otherwise;
(b) Unless a registration statement is in effect as to a security, carrying or causing to be carried through the mails or in interstate commerce, by any means or instruments of transportation, any such security for the
purpose of sale or for delivery after sale; or (c) Making use of any means or instruments of transportation or
communication in interstate commerce or of the mails to offer to sell or offer to buy through the use or medium of any prospectus or otherwise any security, unless a registration statement has been filed with the Commission as to such security, or while the registration statement is the subject of a refusal order or stop order or (prior to the effective date of the registration statement) any public proceeding or examination under Section 8 of the Securities Act, 15 U.S.C. § 77h.
V.
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that Casavant and his agents, servants, employees, attorneys, and all persons in active concert or participation with them who receive actual notice of this Final Judgment by personal service or otherwise are permanently restrained and enjoined from aiding and abetting any violation of Section 13(a) of the Exchange Act, 15 U.S.C. § 78m(a), and Rules 13a-1 and 13a-13 thereunder, 17 C.F.R. §§ 240.13a-1 & 240.13a-13, by knowingly providing substantial assistance to an issuer in filing with the Commission required periodic reports, which fail to include material information necessary to make the required statements, in light of the circumstances under which they are made, not misleading.
VI.
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that Casavant and his agents, servants, employees, attorneys, and all persons in active concert or participation with them who receive actual notice of this Final Judgment by personal service or otherwise are permanently restrained and enjoined from aiding and abetting any violation of Section 13(b)(2)(A) of the Exchange Act, 15 U.S.C. § 78m(b)(2)(A), and violating Rule 13b2-1 thereunder, 17 C.F.R. § 240.13b2-1, by knowingly providing substantial assistance to an issuer that failed to make an keep
books, records, and accounts, which, in reasonable detail, accurately and fairly reflect the transactions and disposition of the assets of the issuer.
VII.
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that Casavant
and his agents, servants, employees, attorneys, and all persons in active concert or participation with them who receive actual notice of this Final Judgment by personal service or otherwise are permanently restrained and enjoined from aiding and abetting any violation of Sections 13(b)(2)(B) of the Exchange Act, 15 U.S.C. § 78m(b)(2)(B), by knowingly providing substantial assistance to an issuer which has a class of securities registered pursuant to Section 12 of the Exchange Act, 15 U.S.C. § 78/, or that is required to file reports pursuant to Section 15(d) of the Exchange Act, 15 U.S.C. § 78o(d), in failing to devise and maintain a sufficient system of internal accounting controls sufficient to provide reasonable assurances that:
a. transactions are executed in accordance with management's general
or specific authorization;
b. transactions are recorded as necessary (i) to permit preparation of
financial statements in conformity with generally accepted
accounting principles or any other criteria applicable to such
statements, and (ii) to maintain accountability for assets;
c. access to assets is permitted only in accordance with management's
general or specific authorization; and
d. the recorded accountability for assets is compared with the existing
assets at reasonable intervals and appropriate action is take with
respect to any differences.
VIII.
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, pursuant to Section 21(d)(2) of the Exchange Act, 15 U.S.C. § 78u(d)(2), and
Section 20(e) of the Securities Act, 15 U.S.C. § 77t(e), Casavant is prohibited from acting as an officer or director of any issuer that has a class of securities registered pursuant to Section 12 of the Exchange Act, 15 U.S.C. § 78/, or that is required to file reports pursuant to Section 15(d) of the Exchange Act, 15 U.S.C. § 78o(d).
IX.
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that
Casavant is permanently barred from participating in an offering of penny stock, including engaging in activities with a broker, dealer, or issuer for purposes of issuing, trading, or inducing or attempting to induce the purchase or sale of any penny stock. A penny stock is any equity security that has a price of less than five dollars, except as provided in Rule 3a51-1 under the Exchange Act, 17 C.F.R. §
240.3a51-1.
X.
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that
Casavant is liable for disgorgement of $31,500,000, representing profits gained as
a result of the conduct alleged in the Complaint, together with prejudgment interest
thereon in the amount of $2,689,433.62, and a civil penalty in the amount of
$31,500,000 pursuant to Section 20(d) of thh Securities Act, 15 U. S.C. Cection 77t(d), and
Section 21(d)(3) of the Exchange Act, 15 U.S.C. 78u(d)(3). Casavant shall satisfy this obligation by paying $34,689,433.62 within ten business days to the Clerk of this Court, together with a cover letter identifying Casavant as a defendant in this action; setting forth the title and civil action number of this action and the name of this Court; and specifying that payment is made pursuant to this Final Judgment. Casavant shall simultaneously transmit photocopies of such payment and letter to the Commission's counsel in this action. By making this payment, Casavant relinquishes all legal and equitable right, title, and interest in such funds, and no part of the funds shall be returned to Casavant. Casavant shall pay post-judgment interest on any delinquent amounts pursuant to 28 U.S.C. § 1961.
The Clerk shall deposit the funds into an interest bearing account with the Court Registry Investment System ("CRIS") or any other type of interest bearing account that is utilized by the Court. These funds, together with any interest and income earned thereon (collectively, the "Fund"), shall be held in the interest bearing account until further order of the Court. In accordance with 28 U.S.C. § 1914 and the guidelines set by the Director of the Administrative Office of the United States Courts, the Clerk is directed, without further order of this Court, to deduct from the income earned on the money in the Fund a fee equal to ten percent of the income earned on the Fund. Such fee shall not exceed that authorized by the Judicial Conference of the United States.
The Commission may by motion propose a plan to distribute the Fund subject to the Court's approval. Such a plan may provide that the Fund shall be distributed pursuant to the Fair Fund provisions of Section 308(a) of the Sarbanes-Oxley Act of 2002. Regardless of whether any such Fair Fund distribution is made, amounts ordered to be paid as civil penalties pursuant to this Judgment shall be treated as penalties paid to the government for all purposes, including all tax purposes. To preserve the deterrent effect of the civil penalty, Casavant shall not, after offset or reduction of any award of compensatory damages in any Related Investor Action based on Casavant's payment of disgorgement in this action, argue that he is entitled to, nor shall he further benefit by, offset or reduction of such compensatory damages award by the amount of any part of Casavant's payment of a civil penalty in this action ("Penalty Offset"). If the court in any Related Investor Action grants such a Penalty Offset, Casavant shall, within 30 days after entry of a final order granting the Penalty Offset, notify the Commission's counsel in this action and pay the amount of the Penalty Offset to the United States Treasury or to a Fair Fund, as the Commission directs. Such a payment shall not be deemed an additional civil penalty and shall not be deemed to change the amount of the civil penalty imposed in this Judgment. For purposes of this paragraph, a "Related
Investor Action" means a private damages action brought against Casavant by or on behalf of one or more investors based on substantially the same facts as alleged in the Complaint in this action.
XI.
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that this Court shall retain jurisdiction of this matter for the purposes of enforcing the terms of this Final Judgment.
X.
There being no just reason for delay, pursuant to Rule 54(b) of the Federal Rules of Civil Procedure, the Clerk is ordered to enter this Final Judgment forthwith and without further notice.
DATED this 2nd day of September, 2009.
LARRY R. HICKS
UNITED STATES DISTRICT JUDGE
