Securities and Exchange Commission v. Ly

Filing 7

ORDER/FINAL JUDGMENT AS TO DEFENDANT JONATHAN LY by U.S. District Judge John C Coughenour. (RS)

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THE HONORABLE JOHN C. COUGHENOUR 1 2 3 4 5 6 UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON AT SEATTLE 7 8 9 10 SECURITIES AND EXCHANGE COMMISSION, CASE NO. C16-1855-JCC ORDER Plaintiff, 11 v. 12 JONATHAN LY, 13 Defendant. 14 15 16 17 FINAL JUDGMENT AS TO DEFENDANT JONATHAN LY The Securities and Exchange Commission having filed a Complaint and Defendant 18 Jonathan Ly having entered a general appearance; consented to the Court’s jurisdiction over 19 Defendant and the subject matter of this action; consented to entry of this Final Judgment; 20 waived findings of fact and conclusions of law; and waived any right to appeal from this Final 21 Judgment: 22 I. 23 IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that Defendant is 24 permanently restrained and enjoined from violating, directly or indirectly, Section 10(b) of the 25 Securities Exchange Act of 1934 (the “Exchange Act”) [15 U.S.C. § 78j(b)] and Rule 10b-5 26 promulgated thereunder [17 C.F.R. § 240.10b-5], by using any means or instrumentality of ORDER PAGE - 1 1 interstate commerce, or of the mails, or of any facility of any national securities exchange, in 2 connection with the purchase or sale of any security: 3 (a) to employ any device, scheme, or artifice to defraud; 4 (b) to make any untrue statement of a material fact or to omit to state a material fact 5 necessary in order to make the statements made, in the light of the circumstances 6 under which they were made, not misleading; or 7 (c) 8 9 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 10 Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also binds the following who 11 receive actual notice of this Final Judgment by personal service or otherwise: (a) Defendant’s 12 officers, agents, servants, employees, and attorneys; and (b) other persons in active concert or 13 participation with Defendant or with anyone described in (a). 14 II. 15 IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that Defendant 16 is permanently restrained and enjoined from violating Section 17(a) of the Securities Act of 1933 17 (the “Securities Act”) [15 U.S.C. § 77q(a)] in the offer or sale of any security by the use of any 18 means or instruments of transportation or communication in interstate commerce or by use of the 19 mails, directly or indirectly: 20 (a) to employ any device, scheme, or artifice to defraud; 21 (b) to obtain money or property by means of any untrue statement of a material fact 22 or any omission of a material fact necessary in order to make the statements 23 made, in light of the circumstances under which they were made, not misleading; 24 or 25 (c) 26 to engage in any transaction, practice, or course of business which operates or would operate as a fraud or deceit upon the purchaser. ORDER PAGE - 2 1 IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, as provided in 2 Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also binds the following who 3 receive actual notice of this Final Judgment by personal service or otherwise: (a) Defendant’s 4 officers, agents, servants, employees, and attorneys; and (b) other persons in active concert or 5 participation with Defendant or with anyone described in (a). 6 7 III. IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that Defendant is liable 8 for disgorgement of $348,515.72, representing profits gained as a result of the conduct alleged in 9 the Complaint, together with prejudgment interest thereon in the amount of $27,391.30. 10 Defendant shall satisfy this obligation by paying $375,907.02 to the Securities and Exchange 11 Commission within 14 days after entry of this Final Judgment. 12 Defendant may transmit payment electronically to the Commission, which will provide 13 detailed ACH transfer/Fedwire instructions upon request. Payment may also be made directly 14 from a bank account via Pay.gov through the SEC website at 15 http://www.sec.gov/about/offices/ofm.htm. Defendant may also pay by certified check, bank 16 cashier’s check, or United States postal money order payable to the Securities and Exchange 17 Commission, which shall be delivered or mailed to 18 Enterprise Services Center 19 Accounts Receivable Branch 20 6500 South MacArthur Boulevard 21 Oklahoma City, OK 73169 22 and shall be accompanied by a letter identifying the case title, civil action number, and name of 23 this Court; Jonathan Ly as a defendant in this action; and specifying that payment is made 24 pursuant to this Final Judgment. 25 Defendant shall simultaneously transmit photocopies of evidence of payment and case 26 identifying information to the Commission’s counsel in this action. By making this payment, ORDER PAGE - 3 1 Defendant relinquishes all legal and equitable right, title, and interest in such funds and no part 2 of the funds shall be returned to Defendant. The Commission shall send the funds paid pursuant 3 to this Final Judgment to the United States Treasury. 4 The Commission may enforce the Court’s judgment for disgorgement and prejudgment 5 interest by moving for civil contempt (and/or through other collection procedures authorized by 6 law) at any time after 14 days following entry of this Final Judgment. Defendant shall pay post 7 judgment interest on any delinquent amounts pursuant to 28 U.S.C. § 1961. 8 9 IV. IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, for purposes of 10 exceptions to discharge set forth in Section 523 of the Bankruptcy Code, 11 U.S.C. §523, the 11 allegations in the complaint are true and admitted by Defendant, and further, any debt for 12 disgorgement, prejudgment interest, civil penalty or other amounts due by Defendant under this 13 Final Judgment or any other judgment, order, consent order, decree or settlement agreement 14 entered in connection with this proceeding, is a debt for the violation by Defendant of the federal 15 securities laws or any regulation or order issued under such laws, as set forth in Section 16 523(a)(19) of the Bankruptcy Code, 11 U.S.C. §523(a)(19). 17 V. 18 IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that the Consent is 19 incorporated herein with the same force and effect as if fully set forth herein, and that Defendant 20 shall comply with all of the undertakings and agreements set forth therein. 21 VI. 22 IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that this Court shall retain 23 jurisdiction of this matter for the purposes of enforcing the terms of this Final Judgment. 24 // 25 // 26 // ORDER PAGE - 4 1 DATED this 13th day of February, 2017. 2 A 3 4 5 John C. Coughenour UNITED STATES DISTRICT JUDGE 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 ORDER PAGE - 5

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