Securities and Exchange Commission v. Curshen et al

Filing 161

OPINION AND ORDER Granting Summary Judgment In Favor of Plaintiff Securities and Exchange Commission and Against Defendant Jonathan Curshen. Signed by Senior Judge James Lawrence King on 6/1/2012. (jw)

UNI
TED STATES DI
STRI COURT
CT
SOUTHERN DI
STRI OF FLORI
CT
DA
Cas No.1: I- ZOS6I K I e
1 CV- NG BAND STRA
SECU RI ES Ar EX CHA NGE COM M I ON ,
TI
SSI
Pl ntf,
ai if
V.

J ATH AN R.CURSH EN ,
ON
MI
CHAEL S.1 0M E,
G
DAVI C.RI ,
D
CCI
RON NY M OR ALES SA LA ZA R,
ROBERT L.W EI
DEN BAU M ,
A RI I RI 'W EI
AV I C'
E
NBA UM ,and
YI
TZCHA K ZI ON a/ca I ACK ZI
GD
l/ ZH
GDON ,
D ef
endant .
s

O PI I N A N D O RD ER G R ANT I G SU M M A RY JU D G M EN T
N O
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I FAV O R O F PLAI FF SEC UR I I A ND EX CH AN G E C O M M I O N
N
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A ND A G A I ST D EFEN D AN T JO N A TH A N C U RSH EN
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TH I CAUSE com esbef e t Cour on consder i ofpl ntf Securtesand
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s mmayj dgme a i tdefn ntJ t nCurh n.
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ied hi cton
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nd her
uar
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ai l
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r l
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d.
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ke
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epert hee c e ,
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-

nom i ac
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ng

s li t so k a d t tt make wa de pe t i a t alywas ( .
e l he t c n ha he r t s e r han t c u l . k )
ng
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ai l
ha n
y
uar
s
r r ed
pa tci ed i a m ar m ani a i oft comm on s ock ofCO 2 Tech,Lt Cur hen' t
r i pat n
ket
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t
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il Smat
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a
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Se g neae ove $ miloni ilg lpott sli CO2Te hsoc (d.!6
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Thi Courha rviwe tej g ntofcrmi lc ito a ais Cus e t
s t s e e d h ud me
i na onvcin g nt rh n,he
S re ngI cme ta ai tCurhe a oh r, ndt i tuci ra t t jr i te
upesdi ndit n g ns s n nd tes a he nsr tons e d o he uy n h
c i i l ralo Unie St t v. s n. Su h r vi w c n e t sCour t t t e is s
rm na t i f t d a es Cur he
c e e onvi c s hi
t ha : h s ue
de er i agai tCur he ar di i i bot t prorand cur entactoni' t is w e
t m ned
ns
s n e sdentcal n h he i
r
i 'l he s ues re
Sact l ltga ed' i t crm i t i ;t det m i i oft
s ualy ii t ' n he i nal ral he er naton hose is w aslcrtcaland
s ues
û ii

ne es r t t j me ti t prora toni' n t b de ofpes soni teci na c s
c say o he udg n n he i ci 'a d he ur n
ruai n h rmi l ae
wasûsi fcanty hea er't i i her See Unied St esv.Jean- it 395 F. a l195.
t gnii l
vi ' han t s e.
t at
Baotse,
3d t

Th j me tofci na c nvitonetblse t tCu s ne g di ac pia yt
e udg n rmi l o ci sa ih s ha rhe nga e n ons rc o
c i s c rte fa mai fa a wiefa d i vi ai of1 U. C.j3 .Ac or ngt
omm t e u iis r ud, l r ud nd r r u n olton 8 S. 71 c di o

t Sup re ngI dit nt t p pos o t c pia ywa :( )t h efe ta ng s r sof
he e s di n cme ,he ur e f he ons r c s 1 o av r e r di ha e

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c t k sue 2) o nga n he rudulnt niulto
ch tc
a tfcal i l tngt ma k tprc a d de nd f rCO2 Te h soc ( t di r t pr c ds
riii l ntai he r e ie n ma o
y
c t k; 3) o ve t he o ee
oft fa f t epe s lus a be e ioft edee n sa ot r;a ( t c ce lte
he rud or h rona e nd n ft h fnda t nd he s nd 4) o on a h
def ndant 'and t rcocons r t 'i vem enti t f audul m ani aton ofCO 2 Tech
e
s
hei
pia ors nvol
n he r
ent
pul i

so k.( ere ng I cme ,Coun 1! 3) Th Su re ngl cmen t e g it deal
tc Sup s di ndit nt
t,
e pe s di ndit t h n oes n o t i
abouthow Cur
shen and ot si ement t cons r
her mpl
ed he
piacy. Cur hen i colat aly es opped
s
s l er l t

fo c tsi t smealgai a i thi i t scvic s .Su r j dgme ti
rm onetng he a le tons gans m n hi i l a e mmay u
n s
a r raewihr s c t t SEC' camsofs c rtesfa a ii fom Se ton 1 a 6ît
pp op it t e pe t o he
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e u ii r ud rsng r
ci 7() he
Se urte Ac,Se ton 1 b)oft Ex ha Ac a SEC Rul l bc iis t ci 0(
he c nge t nd
e 0 5.

lI
ndeed5i aprorO r , t sCourtdes i Unied St esv.Cur
n
i
der hi
crbed t
at
shen asa ûcrm i
' i nal

a to a ai ttes Dee n ba e oni ntc lfcs' steSEC' Compl n.( k t
cin g ns h ame fnda t s d de ia at'a h
S
ait Doc e
No. 1
43

l a iin,s
n ddto ummayj dgl n iwarntda ai tCurhe wihr p c t t SEC'
r u ne ts ra e g ns s n t ese t o he
S
cl m unde Se i 5 oft SecurtesAct To pr avi aton ofSecton 5,t SEC m us
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ove ol i
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demonsr e:
tat

( )t tno r itai wasi e f c f rte s c iisi q si ( t a t
1 ha eg srton
n fe t o h e urte n ue ton; 2) h t he
d e nt eih die ty o i r c l s l o ofe e t s l t s c ii 'a
ef nda s t er r c l r ndie ty o d r f r d o e l he e urtes nd
,

( )t titr tt ta po ttono c
3 ha n e sae r ns ra i r ommuniai weeus d i c ci wih
c ton r e n onne ton t
t s e oroferofsal
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S v. e Ca eNo. -69c 200 W L34 0 a * ( D. a Fe 22, 2) afdi
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pa t SEC v. lo.37 F. 1 1( lhCi. 4) Ac or SEC v. indl Powe Co.49 F.
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Su 2d1 3,1 ( D.Fl 1 99 ; v. va h, F. 1 ,111n.3( Ci.
pp. 36 367 S. a. 9 ) SEC Ca nac 445 3d 05
1 2d r
zoo t tn Eur a & Ov re Commo t Trdes S. v. n Pai sLo
6lquoig open
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F.d l 8,1 4n. ( Ci.1 98).
3 1 2 4 2d r 9 )
A def ndantdiecty ori r l s d orof e ed t s lsecurtesti i can be s
e
r l
ndiecty ol
f r o el
ii if t
hown t
hat

he wasa (
necess y pari pant ora t ubst i f t i t oferng ors lng oft
ar
tci '
s antal ac or' n he f i
eli
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u e se e s c ii . S v. indl Po rCo.49F. p. a 1 2 ( i SEC v.
nr gitrd e urtes' EC Ere y we ,
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Curhe sci na c nvito ra i c j nci wiht Su re ngI cme t
s n' rmi l o cin,e d n onu ton t he pesdi ndit n,
esabls t Curs wasa necess y pari pantand subs antalf ori t ofkrand s e of
t ihes hat
hen
ar
tci
t i act n he t
al
t s tesofCO2 Tech and t i er t e tans aton orcom m uni i w er us i
he ecurii
hat nt sat r port i
caton e ed n
connecton w ih such of era s e. Athi diecton and underhi super son,hi fr ,Red
i
t
f nd al
s r i
s
vii
s im

Se ofer and s d CO2 Tech sock t ough m ar m ake s i t Unied St es He i
a, f ed
ol
t hr
ket
r n he t at .
s
t ef ecola er l es opped fom cont tng t et el
her or lt aly t
r
es i hes wo ement ofSecton 5 labiiy. W ih
s
i
i lt
t

rs e tt terman n ee n ,niss mmayj d me tp p r fldo Fe r ay2 2 2 te
e p c o h e ii g lme t i t u r u g n a es ie n b u r 4, 01 ,h
SEC s te e de et tt s cuii ofCO2Te wer notr seedwiht SEC.(
ubmitd vi nc ha he e rtes
ch e egitr t he
SEC
Appe xa A205 Curhe ha notpr fr dc ere denc wih r pe tt t sf t is
ndi t
) s n s
ofe e ount -vi e t es c o hi acuals ue,
a t r f e i i noti ge nedipu e Thus a 1t e eeme sofSeci n 5 labiiy ha
nd he e or , t s
n nui s t .
, l hr e l nt
to i lt ve
be n s tsid a t Curhen.
e aife s o s

Ac or ngl afe a c r f r viw oft r or a t Cour bei ot nv s f l
c di y, tr a e ul e e
he ec d nd he
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a vs d,ti ORDERED a ADJ
d ie i s
nd UDGED t a s mmayj d me t e a dtes mei h r b ,
h t u r u g n b , n h a s ee y
ENTERED i f vorofPl i ifSec iisa Excha Commison a a i tDef nt
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J t Cus nast Curhe sla lt unde Se i 5a 1 a oft Se iisAc,
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he e if o
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oc di
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n
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