Securities and Exchange Commission v. Prime Star Group, Inc. et al
Filing
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ORDER Granting 45 Motion for Default Judgment in favor of Securities and Exchange Commission and Against Defendants Esper Gullatt Jr. and Stone Financial Group Inc. in the amount of $187,377.70. Signed by Judge Kent J. Dawson on 9/17/2012. (Copies have been distributed pursuant to the NEF - SLR)
Edward D. McCutcheon
Attorney for Plaintiff
801 Brickell Avenue, Suite 1800
Miami, Florida 33131
Direct Dial: (305) 982-6380
Facsimile: (305) 536-4154
E-mail: mccutcheone@sec.gov
UNITED STATES DISTRICT COURT
DISTRICT OF NEVADA
CASE NO.: 2:12-CV-00371-KJD-GWF
SECURITIES AND EXCHANGE
COMMISSION,
:
:
:
Plaintiff,
:
:
v.
:
:
PRIME STAR GROUP, INC.,
:
ROGER MOHLMAN, DANNY COLON,
:
MARYSOL MORERA, FELIX RIVERA,
:
DC INTERNATIONAL CONSULTING LLC, :
KEVIN CARSON, ESPER GULLATT, JR.,
:
THE STONE FINANCIAL GROUP, INC. and :
JOSHUA KONIGSBERG,
:
:
Defendants.
:
___________________________________________:
ORDER GRANTING PLAINTIFF’S MOTION FOR ENTRY OF DEFAULT
JUDGMENT OF PERMANENT INJUNCTION AND OTHER RELIEF AGAINST
DEFENDANTS ESPER GULLATT JR. AND STONE FINANCIAL GROUP
THIS MATTER is before the Court on Plaintiff Securities and Exchange
Commission’s Motion and Memorandum of Points And Authorities In Support of Default
Judgments of Permanent Injunction And Other Relief Against Defendants Esper Gullatt Jr.
and Stone Financial Group Inc. Having considered the motion and the entire record, the
Court enters the following order granting the Plaintiff’s motion and imposing Default
Judgments of Permanent Injunction and Other Relief against both Defendants:
FINDINGS OF FACT AND CONCLUSIONS OF LAW
1.
This Court has personal jurisdiction over the Defendants and the subject
matter of this action. Venue is proper in the District of Nevada.
2.
Each of the Defendants was properly served with a copy of the Summons
and Complaint pursuant to Rule 4 of the Federal Rules of Civil Procedure. Thus, each
Defendant has proper notice of this action.
3.
Defendants’ responsive pleadings were due by July 2, 2012. However,
neither has answered or otherwise responded to the complaint as required by the Federal
Rules of Civil Procedure.
5.
The clerk entered defaults against both defendants on July 12, 2012.
6.
By virtue of their defaults, and the failures of each Defendant to respond
to the complaint, the Defendants are deemed to have admitted the allegations of the
complaint, and liability is established against each of them. Benny v. Pipes, 799 F.2d
489, 495 (9th Cir. 1986), modified, 807 F.2d 1514 (1987). Accordingly, the Court finds
the Defendants committed the violations alleged in the complaint.
7.
None of the individual Defendants is an infant or an incompetent person,
and has no guardian, committee, conservator or other such person appearing on his
behalf.
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Accordingly, it is:
ORDERED AND ADJUDGED that Plaintiff’s Motion and Memorandum of
Points And Authorities In Support of Default Judgments of Permanent Injunction And
Other Relief Against Defendants Esper Gullatt Jr. and Stone Financial Group Inc. is
GRANTED. Default Judgment is entered against the Defendants as follows:
I.
PERMANENT INJUNCTIONS
IT IS FURTHER ORDERED AND ADJUDGED that Gullatt, Stone Financial,
and their agents, servants, employees, attorneys, and all persons in active concert or
participation with them who receive actual notice of this Final Judgment by personal
service or otherwise are 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
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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 under
Section 8 of the Securities Act, 15 U.S.C. § 77h.
II.
DISGORGEMENT
IT IS FURTHER ORDERED AND ADJUDGED that Gullatt and Stone
Financial are liable, on a joint and several basis, for disgorgement of $169,763.08,
representing profits gained as a result of the conduct alleged in the complaint, together
with prejudgment interest thereon in the amount of $17,614.62, for a total of
$187,377.70, for which let execution issue.
Each Defendant shall satisfy their obligation by paying the respective ordered
amount(s) to the Securities and Exchange Commission within 14 days after entry of this
Judgment.
Each Defendant may transmit payment electronically to the Commission, which
will provide detailed ACH transfer/Fedwire instructions upon request.
Payment may
also be made directly from a bank account via Pay.gov through the SEC website at
http://www.sec.gov/about/offices/ofm.htm. The Defendants may also pay by certified
check, bank cashier’s check, or United States postal money order payable to the
Securities and Exchange Commission, which shall be delivered or mailed to:
Enterprise Services Center
Accounts Receivable Branch
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6500 South MacArthur Boulevard
Oklahoma City, OK 73169
and shall be accompanied by a letter identifying the case title, civil action number, and
name of this Court; identifying him, her or it as a defendant in this action; and specifying
that payment is made pursuant to this Judgment.
Defendant shall simultaneously transmit photocopies of evidence of payment and
case identifying information to the Commission’s counsel in this action. By making a
payment, a Defendant relinquishes all legal and equitable right, title, and interest in such
funds and no part of the funds shall be returned to Defendant.
The Commission shall hold the funds (collectively, the “Fund”) and may propose
a plan to distribute the Fund subject to the Court’s approval. The Court shall retain
jurisdiction over the administration of any distribution of the Fund. If the Commission
staff determines that the Fund will not be distributed, the Commission shall send the
funds paid pursuant to this Final Judgment to the United States Treasury.
The Commission may enforce the Court’s judgment for disgorgement and
prejudgment interest by moving for civil contempt (and/or through other collection
procedures authorized by law) at any time after 14 days following entry of this Final
Judgment.
Defendant shall pay post judgment interest on any delinquent amounts
pursuant to 28 U.S.C. § 1961.
III.
PENNY STOCK BAR
IT IS FURTHER ORDERED AND ADJUDGED that Esper Gullatt is
permanently barred from participating in an offering of penny stock, including engaging
in activities with a broker, dealer, or issuer for purposes of issuing, trading, or inducing or
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attempting to induce the purchase or sale of any penny stock. A penny stock is any
equity security that has a price of less than five dollars, except as provided in Rule 3a51-1
under the Exchange Act, 17 C.F.R. 240.3a51-1.
IV.
CIVIL MONEY PENALTY
IT IS FURTHER ORDERED AND ADJUDGED that the Defendants each
shall pay a civil penalty pursuant to Section 20(d) of the Securities Act, 15 U.S.C. §
77t(d). The amount of the civil penalty shall be determined by the Court upon motion of
the Commission that the Commission must file within 90 days of the date of this Order.
IV.
RETENTION OF JURISDICTION
IT IS FURTHER ORDERED AND ADJUDGED that this Court will retain
jurisdiction over this matter and the Defendants in order to implement and carry out the
terms of all Orders and Decrees that may be entered and/or to entertain any suitable
application or motion for additional relief within the jurisdiction of this Court, and will
order other relief that this Court deems appropriate under the circumstances.
V.
RULE 54(b) CERTIFICATION
IT IS FURTHER ORDERED AND ADJUDGED that 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.
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DONE AND ORDERED in Chambers at Las Vegas, Nevada, this ____day of
September
_____________, 2012.
__________________________________
HON. KENT J. DAWSON
UNITED STATES DISTRICT JUDGE
Copies to counsel and parties of record
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