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

Filing 62

MOTION by Plaintiff U.S. Securities and Exchange Commission for judgment by Consent as to Defendant Carlos L. Martinez (Attachments: # 1 Consent of Defendant Carlos L. Martinez)(Costello, Patrick)

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Case: 1:22-cv-03978 Document #: 62 Filed: 11/21/22 Page 1 of 7 PageID #:338 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 Judge Jorge L. Alonso PLAINTIFF’S AGREED MOTION FOR ENTRY OF PARTIAL JUDGMENT BY CONSENT AS TO DEFENDANT CARLOS L. MARTINEZ Plaintiff Securities and Exchange Commission respectfully moves the Court for entry of Partial Judgment by Consent as to Defendant Carlos L. Martinez (“Martinez”). In support of this motion, the SEC shows the Court as follows: 1. The SEC filed its Complaint in this matter on August 1, 2022 (Dkt# 1) alleging, among other things, violations of the registration and antifraud provisions of the federal securities laws – specifically, Sections 5 and 17(a) of the Securities Act of 1933, 15 U.S.C. §§ 77e, 77q(a); and Section 10(b) and Rule 10b-5 of the Securities Exchange Act of 1934, 15 U.S.C. § 78j(b), 17 C.F.R. § 240.10b-5. Case: 1:22-cv-03978 Document #: 62 Filed: 11/21/22 Page 2 of 7 PageID #:339 2. The SEC filed prior Agreed Motions on August 2, 2022 (Dkt# 5), August 10, 2022 (Dkt# 17), and September 1, 2022 (Dkt# 29), seeking entry by consent of a final judgment as to Defendant Samuel D. Ellis (“Ellis”), and partial judgments by consent as to Defendants Sarah L. Theissen (“Theissen”), Mark F. Hamlin (“Hamlin”), and Cheri Beth Bowen (“Bowen”). By Minute Entries on August 4, 2022 (Dkt# 8), August 25, 2022 (Dkt# 24), and September 2, 2022 (Dkt# 31), the Court granted the prior Agreed Motions, and subsequently, on August 8, 2022, August 25, 2022, and September 2, 2022, the Court entered final judgment against Ellis (Dkt# 16), and partial judgments against Theissen (Dkt# 15), Hamlin (Dkt# 25), and Bowen (Dkt# 33). 3. As with Theissen, Hamlin, and Bowen, Martinez also has agreed to a partial settlement of the SEC’s claims. Attached as Exhibit 1 is his signed consent to the proposed partial judgment. This judgment obviates the need to litigate substantive liability on the part of Martinez, and permanently enjoins him from violating the federal securities laws at issue in the Complaint as well as from engaging in certain other activity. The proposed judgment further provides that monetary relief sought by the SEC – in the form of disgorgement, prejudgment interest, and a civil penalty – shall be determined by the Court at a later date on the SEC’s motion. 4. District courts routinely have entered judgments based on this type of “bifurcated” settlement in SEC enforcement actions, and have adopted the procedures described in the attached consent for the monetary relief portion of the proceedings. See, e.g., SEC v. Daubenspeck, 469 F. Supp. 3d 859, 860 (N.D. Ill. 2020); SEC v. Zenergy Int’l, Inc., No. 135511, 2016 U.S. Dist. LEXIS 127630, at *2-4 (N.D. Ill. Sept. 20, 2016); SEC v. Integrity Fin. AZ, LLC, No. 10-782, 2012 U.S. Dist. LEXIS 6758, at *3-4 (N.D. Ohio Jan. 20, 2012). -2- Case: 1:22-cv-03978 Document #: 62 Filed: 11/21/22 Page 3 of 7 PageID #:340 5. In the attached consent, Martinez has agreed the SEC “may present the [proposed judgment] to the Court for signature and entry without further notice.” (See Ex. 1, at ¶ 15.) Under Fed. R. Civ. P. 54(b), there is no just reason to delay entry of the proposed judgment, and the SEC submits entry of the judgment will conserve judicial resources and streamline the issues in this litigation. In addition, there is little risk of a piecemeal appeal, as Martinez has waived his right to appeal from the judgment. (See Ex. 1, at ¶ 7.) 6. This case will proceed in full as to the remaining Defendants – Vladimir Okhotnikov; Mikail Sergeev; and Ronald R. Deering – and is not affected by entry of the proposed judgment.1 7. Pursuant to the Court’s Individual Practices, the proposed judgment in Word format is being emailed separately to Chambers. WHEREFORE, for the reasons cited above, the SEC respectfully requests the Court grant this motion and enter the proposed judgment. DATED: November 21, 2022 Respectfully submitted, SECURITIES AND EXCHANGE COMMISSION By: /s/ Patrick R. Costello Timothy S. Leiman (leimant@sec.gov) (IL #6270153) Chicago Regional Office 175 W. Jackson Blvd., Suite 1450 Chicago, IL 60604 Telephone: (312) 353-5213 1 Defendants Jane Doe a/k/a Lola Ferrari and Sergey Maslakov are in default, and the Court will hear the SEC’s pending motion for default judgment (Dkt# 49) on November 29, 2022. See Dkt# 53. In addition, Defendant Alisha R. Shepperd has agreed to a partial settlement of the SEC’s claims, and the SEC will file her consent along with a motion for entry of partial judgment. -3- Case: 1:22-cv-03978 Document #: 62 Filed: 11/21/22 Page 4 of 7 PageID #:341 Patrick R. Costello (costellop@sec.gov) (FL #75034) Christopher J. Carney (carneyc@sec.gov) (DC #472294) Washington, DC Office 100 F Street NE Washington, DC 20549-5949 Telephone: (202) 551-3982 Admitted Pro Hac Vice Attorneys for Plaintiff -4- Case: 1:22-cv-03978 Document #: 62 Filed: 11/21/22 Page 5 of 7 PageID #:342 CERTIFICATE OF SERVICE I certify that on November 21, 2022, I caused to be served the foregoing PLAINTIFF’S AGREED MOTION FOR ENTRY OF PARTIAL JUDGMENT BY CONSENT AS TO DEFENDANT CARLOS L. MARTINEZ on Defendants at the addresses and by the means set forth on the attached Service List. /s/ Patrick R. Costello Patrick R. Costello Case: 1:22-cv-03978 Document #: 62 Filed: 11/21/22 Page 6 of 7 PageID #:343 Service List Vladimir Okhotnikov c/o James G. Lundy Foley & Lardner LLP 321 North Clark Street, Suite 3000 Chicago, IL 60654 jglundy@foley.com By CM/ECF Mark F. Hamlin c/o Ryan Willis, Christian Dysart, James Kurosad Dysart Willis 530 Hillsborough Street, Suite 200 Raleigh, NC 27603 ryan@dysartwillis.com christian@dysartwillis.com james@dysartwillis.com By electronic mail Sarah L. Theissen c/o Gregg N. Sofer and Patrick Coffey Husch Blackwell LLP 111 Congress Avenue, Suite 1400 Austin, TX 78701-4093 Gregg.sofer@huschblackwell.com patrick.coffey@huschblackwell.com By CM/ECF Carlos L. Martinez c/o Bruce Lewitas Lewitas Hyman 161 N. Clark St., Suite 1600 Chicago, IL 60601 blewitas@securitieslaw.com By electronic mail Ronald R. Deering c/o Peter King and Cindy Innocent Guerra King P.A. The Towers at Westshore 1408 N. Westshore Blvd., Suite 1010 Tampa, FL 33607 pking@guerraking.com cinnocent@guerraking.com By CM/ECF David A. Baugh O’Hagan Meyer, LLC One E. Wacker Drive, Suite 3400 Chicago, IL 60601 dbaugh@ohaganmeyer.com -2- Case: 1:22-cv-03978 Document #: 62 Filed: 11/21/22 Page 7 of 7 PageID #:344 Cheri Beth Bowen c/o Celiza (Lisa) Bragança Bragança Law LLC 5250 Old Orchard Road, Suite 300 Skokie, IL 60077 Lisa@SECDefenseAttorney.com By electronic mail Alisha R. Shepperd c/o Matthew Mueller Fogarty Mueller Harris, PLLC 100 E Madison St., Suite 202 Tampa, FL 33602-4703 matt@fmhlegal.com By electronic mail -3-

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