U.S. Securities and Exchange Commission v. Okhotnikov et al

Filing 5

MOTION by Plaintiff U.S. Securities and Exchange Commission for judgment by Consent as to Defendant Samuel Ellis and Defendant Sarah Theissen (Attachments: #1 Exhibit Ex. 1 Consent of Defendant Samuel Ellis, #2 Exhibit Ex. 2 Consent of Defendant Sarah Theissen)(Leiman, Timothy)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
)
)
)
Plaintiff,
)
)
v.
)
)
VLADIMIR OKHOTNIKOV,
)
JANE DOE a/k/a LOLA FERRARI,
)
MIKAIL SERGEEV,
)
SERGEY MASLAKOV,
)
SAMUEL D. ELLIS,
)
MARK F. HAMLIN,
)
SARAH L. THEISSEN,
)
CARLOS L. MARTINEZ,
)
RONALD R. DEERING,
)
CHERI BETH BOWEN, and
)
ALISHA R. SHEPPERD,
)
)
Defendants.
__________________________________________ )
SECURITIES AND EXCHANGE COMMISSION

Case No. 22 C 3978

CONSENT OF DEFENDANT SARAH L. THEISSEN
Defendant Sarah L. -("Defendant") waives service of a summons and the
complaint in this action, enters a general appearance, and admits the Court's jurisdiction over
Defendant and over the subject matter of this action.
2.

Without admitting or denying the allegations of the complaint (except as provided

herein in paragraph 13 and except as to personal and subject matter jmisdiction, which
Defendant admits), Defendant hereby consents to the entry of the Judgment in the form attached
hereto (the " Judgment") and incorporated by reference herein, which, among other things:
(a)

permanently restrains and enjoins Defendant from violations of Sections 5
and l 7(a) of the Securities Act of 1933 (" Securities Act") {15 U.S.C. §§
77e and 77q(a)] ; and Section lO(b) and Rule lOb-5 of the Securities
Exchange Act of 1934 ("Exchange Act") [15 U.S.C. § 78j(b), 17 C.F.R. §
240. l 0b-5]; and

(b)

permanently restrains and enjoins Defendant from (1) offering, operating,
or participating in any marketing or sales program in which the participant
is compensated or promised compensation solely or primarily for (i)
inducing another person to become a participant in the program; or (ii) if
such induced person induces another to become a paiticipant in the
program; and (2) patticipating directly or indirectly in any offering of
crypto asset securities; provided, however, that, such injunction shall not
prevent Defendant from purchasing or selling crypto asset securities for
her own personal account; and (3) any other relief that the Court deems
just and appropriate.

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3.

Defendant agrees that the Court shall order disgorgement of ill-gotten gains,

prejudgment interest thereon, and a civil penalty pursuant to Section 20(d) of the Securities Act
[15 U.S.C. § 77t(d)] and Section 2I(d)(3) of the Exchange Act [15 U.S.C. § 78u(d)(3)].
Defendant fu11her agrees that the amounts of the disgorgement and civil penalty shall be
determined by the Court upon motion of the Commission, and that prejudgment interest shall be
calculated from July 7, 2020, 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). Defendant

fu1iher agrees that 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 she did not violate the federal securities laws as alleged in the Complaint; (b)
Defendant may not challenge the validity of this Consent or the Final 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 detennine the issues raised in the motion on the basis of
affidavits, declarations, excerpts of sworn 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.
4.

Defendant acknowledges that any civil penalty paid pursuant to a Final Judgment

may 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, the civil penalty
shall be treated as a penalty paid to the government for all purposes, including all tax purposes.
To preserve the deterrent effect of the civil penalty, Defendant agrees that she shall not, after

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offset or reduction of any award of compensatory damages in any Related Investor Action based
on Defendant's payment of disgorgement in this action, argue that she is entitled to, nor shall she
fmther benefit by, offset or reduction of such compensatory damages award by the amount of
any part of Defendant's payment of a civil penalty in this action ("Penalty Offset"). ff the court
in any Related Investor Action grants such a Penalty Offset, Defendant agrees that she shall,
withjn 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
action. For purposes of this paragraph, a " Related Investor Action" means a private damages
action brought against Defendant by or on behalf of one or more investors based on substantially
the same facts as alleged in the Complaint in this action.
5.

Defendant agrees that she shall not seek or accept, directly or indirectly,

reimbursement or indemnification from any source, including but not limited to payment made
pursuant to any insurance policy, with regard to any civil penalty amounts that Defendant pays
pursuant to any Final Judgment, regardless of whether such penalty amounts or any pa1t thereof
are added to a distribution fw1d or otherwise used for the benefit of investors. Defendant further
agrees that she shall not claim, assert, or apply for a tax deduction or tax credit with regard to
any federal, state, or local tax for any penalty amounts that Defendant pays pursuant to any Final
Judgment, regardless of whether such penalty amounts or any part thereof are added to a
distribution fund or otherwise used for the benefit of investors.
6.

Defendant waives the entry of findings of fact and conclusions of law pursuant to

Rule 52 of the Federal Rules of Civil Procedure.

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7.

Defendant waives the right, if any, to a jury trial and to appeal from the entry of

the Judgment.
8.

Defendant enters into this Consent voluntarily and represents that no threats,

offers, promises, or inducements of any kind have been made by the Commission or any
member, officer, employee, agent, or representative of the Commission to induce Defendant to
enter into this Consent.
9.

Defendant agrees that this Consent shall be incorporated into the Judgment with

the same force and effect as if fully set forth therein.
10.

Defendant will not oppose the enforcement of the Judgment on the ground, if any

exists, that it fails to comply with Rule 65(d) of the Federal Rules of Civil Procedure, and hereby
waives any objection based thereon.
11.

Defendant waives service of the Judgment and agrees that entry of the Judgment

by the Court and filing with the Clerk of the Com1 will constitute notice to Defendant of its te1ms
and conditions. Defendant further agrees to provide counsel for the Commission, within thirty
days after the Judgment is filed with the Clerk of the Court, with an affidavit or declaration
stating that Defendant has received and read a copy of the Judgment.

12.

Consistent with 17 C.F.R. § 202.5(±), this Consent resolves only the claims

asserted against Defendant in this civil proceeding. Defendant acknowledges that no promise or
representation has been made by the Commission or any member, officer, employee, agent, or
representative of the Commission with regard to any criminal liability that may have arisen or
may arise from the facts underlying this action or immunity from any such criminal liability.
Defendant waives any claim of Double Jeopardy based upon the settlement of this proceeding,
including the imposition of any remedy or civil penalty herein. Defendant further acknowledges

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that the Court's entry of a permanent injunction may have collateral consequences under federal
or state law and the rules and regulations of self-regulatory organizations, licensing boards, and
other regulatory organizations. Such collateral consequences include, but are not limited to, a
statutory disqualification with respect to membership or participation in, or association with a
member of, a self-regulatory organization. This statutory disqualification has consequences that
are separate from any sanction imposed in an administrative proceeding. In addition, in any
disci'plinary proceeding before the Commission based on the entry of the injunction in this
action, Defendant understands that she shall not be permitted to contest the factual allegations of
the complaint in this action.
13.

Defendant understands and agrees to comply with the terms of 17 C.F.R.

§ 202.5(e), which provides in part that it is the Commission' s policy " not to permit a defendant
or respondent to consent to a judgment or order that imposes a sanction while denying the
all.egations in the complaint or order for proceedings," and "a refusal to admit the allegations is
equivalent to a denial, unless the defendant or respondent states that she neither admits nor
denies the allegations." As part of Defendant's agreement to comply with the terms of Section
202.5(e), Defendant: (i) will not take any action or make or permit to be made any public
statement denying, directly or indirectly, any allegation in the complaint or creating the
impression that the complaint is without factual basis; (ii) will not make or permit to be made
any public statement to the effect that Defendant does not admit the allegations of the complaint,
or that this Consent contains no admission of the allegations, without also stating that Defendant
does not deny the allegations; (iii) upon the filing of this Consent, Defendant hereby withdraws
any papers filed in this action to the extent that they deny any allegation in the complaint; and
(iv) stipulates solely for purposes of exceptions to discharge set forth in Section 523 of the

6

Bankruptcy Code, l 1 U.S.C. § 523, that the all.egations in the complaint are true, and further, that
any debt for disgorgement, prejudgment interest, civil penalty or other amounts due by
Defendant under a Final Judgment or any other judgment, order, consent order, decree or
settlement agreement entered in connection with this proceeding, is a debt for the violation by
Defendant of the federal securities laws or any regulation or order issued under such laws, as set
forth in Section 523(a)( 19) of the Bankruptcy Code, 11 U .S.C. § 523(a)( 1. 9). If Defendant
breaches this agreement, the Commission may petition the Court to vacate the Judgment and
restore this action to its active docket. Nothing in this paragraph affects Defendant's: (i)
testimonial obligations; or (ii) right to take legal or factual positions in litigation or other legal
proceedings in which the Commission is not a party.
14.

Defendant hereby waives any rights under the Equal Access to Justice Act, the

Small Business Regulatory Enforcement Fairness Act of I. 996, or any other provision of law to
seek from the United States, or any agency, or any official of the United States acting in his or
her official capacity, directly or indirectly, reimbursement of attorney's fees or other fees,
expenses, or costs expended by Defendant to defend against this action. For these purposes,
Defendant agrees that Defendant is not the prevailing party in this action since the pa11ies have
reached a good faith settlement.
15.

In connection with this action and any related judicial or administrative

proceeding or investigation commenced by the Commission or to which the Commission is a
patty, Defendant (i) agrees to appear and be interviewed by Commission staff at such times and
places as the staff requests upon reasonable notice; (ii) will accept service by email, mail or
facsimile transmission of notices or subpoenas issued by the Commission for documents or
testimony at depositions, hearings, or trials, or in connection with any related investigation by

7

Commission staff; (iii) appoints Defendant's undersigned attorney as agent to receive service of
such notices and subpoenas; (iv) with respect to such notices and subpoenas, waives the
territorial limits on service contained in Rule 45 of the Federal Rules of Civil Procedure and any
applicable local rules, provided that the party requesting the testimony reimburses Defendant's
travel, lodging, and subsistence expenses at the then-prevai.ling U.S. Government per diem rates;
and (v) consents to personal jurisdiction over Defendant in any United States District Court for
purposes of enforcing any such subpoena.

16.

Defendant agrees that the Commission may present the Judgment to the Court for

signature and entry without further notice.

17.

Defendant agrees that this Court shall retain jurisdiction over this matter for the

purpose of enforcing the terms of the Judgment and any Final Judgment entered in this matter.

/2aiwd :id'\itt MA✓

Sarah L Theissen

,t.,

On _~- - -,-f-l"-'-'"-,,\-...._._ _, 2022,
fi.
'.I[.:.,,_, , a person known to me,
efore me and acknowledged exe' ing the foregoing Consent.

Nota
Commission expires:);)
as to form:

Gregg N. Sofer
Husch Blackwell LLP
1801 Pennsylvania Avenue, NW
Suite 1000
Washington, DC 20006
Attomey for Defendant

8

/b

J t/

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
)
)
)
Plaintiff,
)
)
v.
)
)
VLADIMIR OKHOTNIKOV,
)
JANE DOE a/k/a LOLA FERRARI,
)
MIKAIL SERGEEV,
)
SERGEY MASLAKOV,
)
SAMUEL D. ELLIS,
)
MARK F. HAMLIN,
)
SARAH L. THEISSEN,
)
CARLOS L. MARTINEZ,
)
RONALD R. DEERING,
)
CHERI BETH BOWEN, and
)
ALISHA R. SHEPPERD,
)
)
Defendants.
__________________________________________ )
SECURITIES AND EXCHANGE COMMISSION

Case No. 22 C 3978

JUDGMENT AS TO DEFENDANT SARAH L. THEISSEN
The Securities and Exchange Commission having filed a Complaint and Defendant Sarah
L. Theissen 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; 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 is
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

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under Section 8 of the Securities Act [15 U.S.C. § 77h].
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, as provided in
Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also binds the following who
receive actual notice of this Judgment by personal service or otherwise: (a) Defendant’s officers,
agents, servants, employees, and attorneys; and (b) other persons in active concert or
participation with Defendant or with anyone described in (a).
II.
IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that Defendant
is 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.

IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, as provided in
Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also binds the following who
receive actual notice of this Judgment by personal service or otherwise: (a) Defendant’s officers,
agents, servants, employees, and attorneys; and (b) other persons in active concert or

3

participation with Defendant or with anyone described in (a).
III.
IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that Defendant
is 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.

IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, as provided in
Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also binds the following who
receive actual notice of this Judgment by personal service or otherwise: (a) Defendant’s officers,
agents, servants, employees, and attorneys; and (b) other persons in active concert or
participation with Defendant or with anyone described in (a).
IV.
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that pursuant to Section
21(d)(5) of the Exchange Act [15 U.S.C. § 78u(d)(5)], Defendant is permanently restrained and
enjoined from (1) offering, operating, or participating in any marketing or sales program in

4

which the participant is compensated or promised compensation solely or primarily for (a)
inducing another person to become a participant in the program; or (b) if such induced person
induces another to become a participant in the program; and (2) participating directly or
indirectly in any offering of crypto asset securities; provided, however, that, such injunction shall
not prevent Defendant from purchasing or selling crypto asset securities for his own personal
account; and (3) any other relief that the Court deems just and appropriate.
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, as provided in
Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also binds the following who
receive actual notice of this Judgment by personal service or otherwise: (a) Defendant’s officers,
agents, servants, employees, and attorneys; and (b) other persons in active concert or
participation with Defendant or with anyone described in (a).
V.
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 20(d) of the Securities Act [15 U.S.C. § 77t(d)] and Section 21(d)(3) of the
Exchange Act [15 U.S.C. § 78u(d)(3)]. The Court shall determine the amounts of the
disgorgement and civil penalty upon motion of the Commission. Prejudgment interest shall be
calculated from July 7, 2020, 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 she 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

5

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
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.
VI.
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, solely for purposes of
exceptions to discharge set forth in Section 523 of the Bankruptcy Code, 11 U.S.C. §523, the
allegations in the complaint are true and admitted by Defendant, and further, any debt for
disgorgement, prejudgment interest, civil penalty or other amounts due by Defendant under this
Judgment or any other judgment, order, consent order, decree or settlement agreement entered in
connection with this proceeding, is a debt for the violation by Defendant of the federal securities
laws or any regulation or order issued under such laws, as set forth in Section 523(a)(19) of the
Bankruptcy Code, 11 U.S.C. §523(a)(19).
VII.
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.

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VIII.
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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