United States Securities and Exchange Commission v. Dushek et al

Filing 19

MOTION by Plaintiff United States Securities and Exchange Commission for judgment (Attachments: # 1 Exhibit 1 -- Consent of Charles J. Dushek, # 2 Exhibit 2 -- Consent of Charles S. Dushek, # 3 Exhibit 3 -- Consent of CMA, # 4 Exhibit 4 -- Proposed Judgment, # 5 Exhibit 5 -- Proposed Judgment, # 6 Exhibit 6 -- Proposed Judgment)(Seeger, Steven)

EXHIBIT
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UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
__________________________________________
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UNITED STATES SECURITIES
AND EXCHANGE COMMISSION,
Plaintiff,
v.
CHARLES J. DUSHEK,
CHARLES S. DUSHEK, and
CAPITAL MANAGEMENT ASSOCIATES,
INC.,
Defendants,
and
MARGARET L. DUSHEK,
Relief Defendant.

Case No. 13-cv-3669
Hon. Gary Feinerman

JUDGMENT AS TO DEFENDANT CAPITAL MANAGEMENT ASSOCIATES, INC.
The Securities and Exchange Commission having filed a Complaint and Defendant
Capital Management Associates, Inc. having entered a general appearance; consented to the
Court’s jurisdiction over Defendant and the subject matter of this action; consented to entry of
this Judgment without admitting or denying the allegations of the Complaint (except as to
jurisdiction); waived findings of fact and conclusions of law; and waived any right to appeal
from this Judgment:
I.

IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that Defendant and
Defendant’s agents, servants, employees, attorneys, and all persons in active concert or
participation with them who receive actual notice of this 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.
II.

IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that Defendant
and Defendant’s agents, servants, employees, attorneys, and all persons in active concert or
participation with them who receive actual notice of this Judgment by personal service or
otherwise are permanently restrained and enjoined from violating Section 206(1) of the
Investment Advisers Act of 1940 (“Advisers Act”) [15 U.S.C. §§ 80b-6(1)], by, as an investment
adviser, using the mails, or any means or instrumentality of interstate commerce, directly or
indirectly, to employ any device, scheme, or artifice to defraud any client or prospective client.

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III.
IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that Defendant
and Defendant’s agents, servants, employees, attorneys, and all persons in active concert or
participation with them who receive actual notice of this Judgment by personal service or
otherwise are permanently restrained and enjoined from violating Section 206(2) of the
Investment Advisers Act of 1940 (“Advisers Act”) [15 U.S.C. §§ 80b-6(2)], by, as an investment
adviser, using the mails, or any means or instrumentality of interstate commerce, directly or
indirectly, to engage in any transaction, practice, or course of business which operates as a fraud
or deceit upon any client or prospective client.
IV.
IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that Defendant
shall pay disgorgement of ill-gotten gains, prejudgment interest thereon, and a civil penalty
pursuant to Section 21(d)(3) of the Exchange Act [15 U.S.C. § 78u(d)(3)] and Section 209(e) of
the Advisers Act [15 U.S.C. § 80b-9(e)]. The Court shall determine the amounts of the
disgorgement and civil penalty upon motion of the Commission. Prejudgment interest shall be
calculated from July 1, 2008, based on the rate of interest used by the Internal Revenue Service
for the underpayment of federal income tax as set forth in 26 U.S.C. § 6621(a)(2). In connection
with the Commission’s motion for disgorgement and/or civil penalties, and at any hearing held
on such a motion: (a) Defendant will be precluded from arguing that it did not violate the federal
securities laws as alleged in the Complaint; (b) Defendant may not challenge the validity of the
Consent or this Judgment; (c) solely for the purposes of such motion, the allegations of the
Complaint shall be accepted as and deemed true by the Court; and (d) the Court may determine
the issues raised in the motion on the basis of affidavits, declarations, excerpts of sworn
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deposition or investigative testimony, and documentary evidence, without regard to the standards
for summary judgment contained in Rule 56(c) of the Federal Rules of Civil Procedure. In
connection with the Commission’s motion for disgorgement and/or civil penalties, the parties
may take discovery, including discovery from appropriate non-parties.
V.
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that the Consent is
incorporated herein with the same force and effect as if fully set forth herein, and that Defendant
shall comply with all of the undertakings and agreements set forth therein.
VI.
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 Judgment.
VII.
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 Judgment forthwith and without further notice.

Dated: ______________, _____
____________________________________
UNITED STATES DISTRICT JUDGE

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