Securities And Exchange Commission v. Berry

Filing 308

JUDGMENT against Lisa C. Berry. Signed by Judge Whyte on 10/7/2011. (rmwlc1, COURT STAFF) (Filed on 10/7/2011)

1 MARC J. FAGEL (Cal. Bar. No. 154425)
SUSAN F. LaMARCA (Cal. Bar No. 213251)
2 [e-mail]
ROBERT L. TASHJIAN (Cal. Bar No. 191007)
3 [e-mail]
ROBERT L. MITCHELL (Cal. Bar No. 161354)
4 [e-mail]
JEREMY E. PENDREY (Cal. Bar No. 187075)
5 [e-mail]
ELENA RO (Cal. Bar No. 197308)
6 [e-mail]
7 Attorneys for Plaintiff
SECURITIES AND EXCHANGE COMMISSION
8 44 Montgomery Street, Suite 2600
San Francisco, California 94104
9 Telephone: [phone]
Facsimile: [phone]
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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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SAN FRANCISCO DIVISION

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15 SECURITIES AND EXCHANGE COMMISSION, Case No. C-07-4431-RMW (HRL)
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Plaintiff,

[] FINAL JUDGMENT
AGAINST DEFENDANT LISA C. BERRY

vs.

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Defendant.

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The Securities and Exchange Commission having filed a Second Amended Complaint

23 (“Complaint”) and defendant Lisa C. Berry (“Defendant”) having entered a general appearance;
24 consented to the Court’s jurisdiction over Defendant and the subject matter of this action; consented
25 to entry of this Final Judgment without admitting or denying the allegations of the Complaint (except
26 as to jurisdiction); waived findings of fact and conclusions of law; and waived any right to appeal
27 from this Final Judgment:
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[] FINAL JUDGMENT
SEC v. BERRY
Case No. C-07-4431-RMW (HRL)

I.

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IT IS HEREBY ORDERED, ADJUDGED AND DECREED that Defendant and Defendant’s

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agents, servants, employees, attorneys-in-fact, and all persons in active concert or participation with

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them who receive actual notice of this Final Judgment by personal service or otherwise are

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permanently restrained and enjoined from violating Sections 17(a)(2) and 17(a)(3) of the Securities

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Act of 1933 (“Securities Act”) [15 U.S.C. §§ 77q(a)(2) and 77q(a)(3)] by, in the offer or sale of any

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security by the use of any means or instruments of transportation or communication in interstate

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commerce or by use of the mails, directly or indirectly:

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(a)

obtaining money or property by means of any untrue statement of a material fact or

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any omission to state a material fact necessary in order to make the statements made,

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in light of the circumstances under which they were made, not misleading; or

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(b)

engaging in any transaction, practice, or course of business which operates or
would operate as a fraud or deceit upon the purchaser.
II.

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IT IS FURTHER ORDERED, ADJUDGED AND DECREED that Defendant and

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Defendant’s agents, servants, employees, attorneys-in-fact, and all persons in active concert or

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participation with them who receive actual notice of this Final Judgment by personal service or

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otherwise are permanently restrained and enjoined from violating Section 13(b)(5) of the Securities

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Exchange Act of 1934 (“Exchange Act”) [15 U.S.C. § 78m(b)(5)] by knowingly circumventing or

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failing to implement a system of internal accounting controls, or knowingly falsifying any book,

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record, or account for any issuer which has a class of securities registered with the Commission

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pursuant to Section 12 of the Exchange Act [15 U.S.C. § 78l] or is required to file reports with the

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Commission pursuant to Section 15 of the Exchange Act [15 U.S.C. § 78o].
III.

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IT IS FURTHER ORDERED, ADJUDGED AND DECREED that Defendant and

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Defendant’s agents, servants, employees, attorneys-in-fact, and all persons in active concert or

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participation with them who receive actual notice of this Final Judgment by personal service or

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otherwise are permanently restrained and enjoined from violating Rule 13b2-1 under the Exchange
[] FINAL JUDGMENT
SEC v. BERRY
Case No. C-07-4431-RMW (HRL)

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Act [17 C.F.R. § 240.13b2-1] by, directly or indirectly, falsifying or causing to be falsified any book,

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record or account subject to Section 13(b)(2)(A) of the Exchange Act [15 U.S.C. § 78m(b)(2)(A)].
IV.

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IT IS FURTHER ORDERED, ADJUDGED AND DECREED that Defendant and

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Defendant’s agents, servants, employees, attorneys-in-fact, and all persons in active concert or

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participation with them who receive actual notice of this Final Judgment by personal service or

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otherwise are permanently restrained and enjoined from aiding and abetting the violation of Section

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13(a) of the Exchange Act [15 U.S.C. § 78m(a)] and Rules 12b-20, 13a-1, 13a-11, and 13a-13

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thereunder [17 C.F.R. §§ 240.12b-20, 240.13a-1, 240.13a-11 and 240.13a-13] by knowingly

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providing substantial assistance to any issuer of securities registered pursuant to Section 12 of the

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Exchange Act [15 U.S.C. § 78l] in filing with the Commission annual, quarterly, or current reports

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that contain untrue statements of material fact or omit to state material information necessary in order

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to make the statements made, in the light of the circumstances under which they were made, not

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misleading.
V.

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IT IS FURTHER ORDERED, ADJUDGED AND DECREED that Defendant and

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Defendant’s agents, servants, employees, attorneys-in-fact, and all persons in active concert or

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participation with them who receive actual notice of this Final Judgment by personal service or

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otherwise are permanently restrained and enjoined from aiding and abetting the violation of Sections

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13(b)(2)(A) and (B) of the Exchange Act [15 U.S.C. §§ 78m(b)(2)(A) and (B)] by knowingly

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providing substantial assistance to any issuer which has a class of securities registered pursuant to

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Section 12 of the Exchange Act [15 U.S.C. § 78l] or is required to file reports with the Commission

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pursuant to Section 15 of the Exchange Act [15 U.S.C. § 78o] in making and keeping books, records

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and accounts, which fail, in reasonable detail, to accurately and fairly reflect the transactions and

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dispositions of the assets of the issuer; or in devising and maintaining a system of internal accounting

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controls that is insufficient to provide reasonable assurances that: (i) transactions are executed in

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accordance with management’s general or specific authorization; (ii) transactions are recorded as

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necessary to (I) permit preparation of financial statements in conformity with generally accepted
[] FINAL JUDGMENT
SEC v. BERRY
Case No. C-07-4431-RMW (HRL)

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accounting principles or any other criteria applicable to such statements, and (II) maintain

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accountability for assets; (iii) access to assets is permitted only in accordance with management’s

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general or specific authorization; and (iv) the recorded accountability for assets is compared with the

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existing assets at reasonable intervals and appropriate action is taken with respect to any differences.

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VI.

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IT IS FURTHER ORDERED, ADJUDGED AND DECREED that Defendant and

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Defendant’s agents, servants, employees, attorneys-in-fact, and all persons in active concert or

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participation with them who receive actual notice of this Final Judgment by personal service or

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otherwise are permanently restrained and enjoined from aiding and abetting the violation of Section

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14(a) of the Exchange Act [15 U.S.C. § 78n(a)] and Rule 14a-9 thereunder [17 C.F.R. § 240.14a-9]

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by knowingly providing substantial assistance in the solicitation, with respect to any security (other

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than an exempted security) registered pursuant to Section 12 of the Exchange Act [15 U.S.C. § 78l],

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by means of a proxy statement, form of proxy, notice of meeting or other communication, written or

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oral, that contains a statement which, at the time and in the light of the circumstances under which it

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is made, is false or misleading with respect to any material fact, or which omits to state any material

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fact necessary: (i) in order to make the statements therein not false or misleading; or (ii) to correct

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any statement in any earlier communication with respect to the solicitation of a proxy for the same

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meeting or subject matter which has become false or misleading.
VII.

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IT IS FURTHER ORDERED, ADJUDGED AND DECREED that Defendant is liable for

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disgorgement in the total amount of $77,120, comprised of $56,531, representing profits gained as a

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result of the conduct alleged in the Complaint, together with prejudgment interest thereon in the

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amount of $20,589. Defendant shall satisfy this obligation by paying $77,120 by certified check,

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bank cashier’s check, or United States postal money order payable to the Securities and Exchange

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Commission within 60 days after entry of this Final Judgment. Defendant shall deliver or mail such

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payment to the Office of Financial Management, Securities and Exchange Commission, 100 F Street,

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NE, Stop 6042, Washington DC 20549, accompanied by a letter identifying Lisa C. Berry as a

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defendant in this action; setting forth the title and civil action number of this action and the name of
[] FINAL JUDGMENT
SEC v. BERRY
Case No. C-07-4431-RMW (HRL)

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this Court; and specifying that payment is made pursuant to this Final Judgment. Defendant shall

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also simultaneously send a copy of the cover letter and payment instrument to Robert L. Tashjian,

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San Francisco Regional Office, Securities and Exchange Commission, 44 Montgomery Street,

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Suite 2600, San Francisco, CA 94104. Defendant shall pay post-judgment interest on any delinquent

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amounts pursuant to 28 USC § 1961. The Commission shall remit the funds paid pursuant to this

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paragraph to the United States Treasury.
VIII.

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IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that Defendant is liable for a
civil penalty in the amount of $350,000 pursuant to Section 20(d) of the Securities Act [15 U.S.C.

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§ 77t(d)] and Section 21(d)(3) of the Exchange Act [15 U.S.C. § 78u(d)(3)]. Defendant shall satisfy

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this obligation by paying a total of $350,000 by certified check, bank cashier’s check, or United

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States postal money order payable to the Securities and Exchange Commission pursuant to the

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following payment schedule: (1) $50,000 must be paid within 14 days after entry of this Final

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Judgment; (2) $300,000 must be paid within 270 days after entry of this Final Judgment. Defendant

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shall deliver or mail each such payment to the Office of Financial Management, Securities and

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Exchange Commission, 100 F Street, NE, Stop 6042, Washington DC 20549, accompanied by a letter

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identifying Lisa C. Berry as a defendant in this action; setting forth the title and civil action number

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of this action and the name of this Court; and specifying that payment is made pursuant to this Final

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Judgment. For each such payment, Defendant shall also simultaneously send a copy of the cover

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letter and payment instrument to Robert L. Tashjian, San Francisco Regional Office, Securities and

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Exchange Commission, 44 Montgomery Street, Suite 2600, San Francisco, CA 94104. If Defendant

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fails to make any payment by the above described dates, or in the above described amounts,

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according to the schedule, all outstanding payments under this Final Judgment shall become due and

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payable immediately without further application to the Court. Defendant shall pay post-judgment

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interest on any delinquent amounts pursuant to 28 USC § 1961. The Commission shall remit the

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funds paid pursuant to this paragraph to the United States Treasury.

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[] FINAL JUDGMENT
SEC v. BERRY
Case No. C-07-4431-RMW (HRL)

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IX.

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IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that the Consent of Defendant

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Lisa C. Berry to Entry of Final Judgment is incorporated herein with the same force and effect as if

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fully set forth herein, and that Defendant shall comply with all of the undertakings and agreements set

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forth therein.
X.

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IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that this Court shall retain

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jurisdiction of this matter for the purposes of enforcing the terms of this Final Judgment.

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IT IS SO ORDERED.

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Dated:

, 2011
UNITED STATES DISTRICT JUDGE

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[] FINAL JUDGMENT
SEC v. BERRY
Case No. C-07-4431-RMW (HRL)

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Approved as to form:
/s/ James N. Kramer
James N. Kramer
ORRICK, HERRINGTON & SUTCLIFFE, LLP
The Orrick Building
405 Howard Street
San Francisco, CA 94105-2669
Tel.: [phone]

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Attorney for Defendant
LISA C. BERRY

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Submitted by:

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/s/ Robert L. Tashjian
Robert L. Tashjian
SECURITIES AND EXCHANGE COMMISSION
44 Montgomery Street, Suite 2600
San Francisco, California 94104
Tel.: [phone]

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[] FINAL JUDGMENT
SEC v. BERRY
Case No. C-07-4431-RMW (HRL)

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