Securities and Exchange Commission v. Maximum Return Investments, Inc. et al, No. 2:2009cv02536 - Document 18 (C.D. Cal. 2009)

Court Description: AMENDED FINAL JUDGMENT OF PERMANENT INJUNCTION AND OTHER RELIEF AGAINST DEFENDANTS MAXIMUM RETURN INVESTMENTS, INC. AND CLELIA A. FLORES 13 by Judge Otis D Wright, II: Commissions motion for entry of a amended final judgment by default against Defen dants MRI and Flores is hereby GRANTED 15 ; Defendants and Defendants agents are permanently restrained and enjoined (see document for specifics); Defendants MRI and Flores shall be jointly and severally liable for payment of disgorgement in the am ount of $10,355,778.00, together with prejudgment interest of $259,738.63; Defendant MRI shall pay a civil penalty in the amount $130,000.00, defendants MRI and Flores shall make the payments ordered above within ten (10) business days after entry of this Final Judgment. (See document for specifics ) (lc)

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Securities and Exchange Commission v. Maximum Return Investments, Inc. et al 1 2 3 4 5 6 7 8 9 Doc. 18 JOHN B. BULGOZDY, Cal. Bar No. 219897 Email: bulgozdyj@sec.gov FINOLA H. MANVELIAN, Cal. Bar No. 180681 Email: manvelianf@sec.gov JESSICA R. PUATHASNANON, Cal. Bar No. 208074 Email: puathasnanonj@sec.gov DOUGLAS F. KOBAYASHI, Cal. Bar No. 205886 Email: kobayashid@sec.gov Attorneys for Plaintiff Securities and Exchange Commission Rosalind R. Tyson, Regional Director Andrew G. Petillon, Associate Regional Director John M. McCoy III, Regional Trial Counsel 5670 Wilshire Boulevard, 11th Floor Los Angeles, California 90036 Telephone: (323) 965-3322 Facsimile: (323) 965-3815 10 11 UNITED STATES DISTRICT COURT 12 FOR THE CENTRAL DISTRICT OF CALIFORNIA 13 WESTERN DIVISION 14 15 16 17 18 19 20 SECURITIES AND EXCHANGE COMMISSION, Case No. CV 09-2536 ODW (SHx) AMENDED FINAL JUDGMENT OF PERMANENT INJUNCTION AND OTHER RELIEF AGAINST vs. DEFENDANTS MAXIMUM RETURN INVESTMENTS, INC. MAXIMUM RETURN INVESTMENTS, AND CLELIA A. FLORES INC. and CLELIA A. FLORES, Plaintiff, Defendants. 21 22 Now before the Court is Plaintiff Securities and Exchange Commission’s 23 (“Commission”) Motion to Amend Final Judgment to Add Specific Amounts of 24 Civil Penalties Against Defendants Maximum Return Investments, Inc. (“MRI”) and 25 Clelia A. Flores (“Flores”), pursuant to Fed. R. Civ. P. 59(e). The Court, having 26 considered the Commission’s motion, memoranda of points and authorities, the 27 declarations relating thereto, the entire record of this case, and all evidence and 28 other argument presented regarding this motion, finds that: Dockets.Justia.com 1 I. 2 IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that the 3 Commission’s motion to amend the final judgment to add specific amounts of civil 4 penalties against Defendants MRI and Flores is hereby GRANTED. II. 5 6 IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that 7 Defendants and Defendants’ agents, servants, employees, attorneys, and all persons 8 in active concert or participation with them who receive actual notice of this Final 9 Judgment by personal service or otherwise are permanently restrained and enjoined 10 from violating, directly or indirectly, Section 10(b) of the Securities Exchange Act 11 of 1934 (the “Exchange Act”), 15 U.S.C. § 78j(b), and Rule 10b-5 promulgated 12 thereunder, 17 C.F.R. § 240.10b-5, by using any means or instrumentality of 13 interstate commerce, or of the mails, or of any facility of any national securities 14 exchange, in connection with the purchase or sale of any security: 15 (a) to employ any device, scheme, or artifice to defraud; 16 (b) to make any untrue statement of a material fact or to omit to state a 17 material fact necessary in order to make the statements made, in the 18 light of the circumstances under which they were made, not 19 misleading; or 20 21 22 (c) to engage in any act, practice, or course of business which operates or would operate as a fraud or deceit upon any person. III. 23 IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED 24 that Defendants and Defendants’ agents, servants, employees, attorneys, and all 25 persons in active concert or participation with them who receive actual notice of 26 this Final Judgment by personal service or otherwise are permanently restrained 27 and enjoined from violating Section 17(a) of the Securities Act of 1933 (the 28 “Securities Act”), 15 U.S.C. § 77q(a), in the offer or sale of any security by the use 2 1 of any means or instruments of transportation or communication in interstate 2 commerce or by use of the mails, directly or indirectly: 3 (a) to employ any device, scheme, or artifice to defraud; 4 (b) to obtain money or property by means of any untrue statement of a 5 material fact or any omission of a material fact necessary in order to 6 make the statements made, in light of the circumstances under which 7 they were made, not misleading; or 8 (c) to engage in any transaction, practice, or course of business which operates or would operate as a fraud or deceit upon the purchaser. 9 IV. 10 11 IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED 12 that Defendants and Defendants’ agents, servants, employees, attorneys, and all 13 persons in active concert or participation with them who receive actual notice of 14 this Final Judgment by personal service or otherwise are permanently restrained 15 and enjoined from violating Section 5 of the Securities Act, 15 U.S.C. § 77e, by, 16 directly or indirectly, in the absence of any applicable exemption: 17 (a) Unless a registration statement is in effect as to a security, making 18 use of any means or instruments of transportation or communication 19 in interstate commerce or of the mails to sell such security through 20 the use or medium of any prospectus or otherwise; 21 (b) Unless a registration statement is in effect as to a security, carrying or 22 causing to be carried through the mails or in interstate commerce, by 23 any means or instruments of transportation, any such security for the 24 purpose of sale or for delivery after sale; or 25 (c) Making use of any means or instruments of transportation or 26 communication in interstate commerce or of the mails to offer to sell 27 or offer to buy through the use or medium of any prospectus or 28 otherwise any security, unless a registration statement has been filed 3 1 with the Commission as to such security, or while the registration 2 statement is the subject of a refusal order or stop order or (prior to the 3 effective date of the registration statement) any public proceeding or 4 examination under Section 8 of the Securities Act. 15 U.S.C. § 77h. V. 5 6 IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED 7 that Defendants MRI and Flores shall be jointly and severally liable for payment of 8 disgorgement in the amount of $10,355,778.00, together with prejudgment interest 9 of $259,738.63. VI. 10 11 IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED 12 that Defendant MRI shall pay a civil penalty in the amount of $650,000, and 13 defendant Flores shall pay a civil penalty in the amount of $130,000, pursuant to 14 Section 20(d) of the Securities Act, 15 U.S.C. § 77t(d), and Section 20(d)(3) of the 15 Exchange Act, 15 U.S. C. § 78u(d)(3). 16 17 VII. IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that 18 Defendants MRI and Flores shall make the payments ordered above within ten (10) 19 business days after entry of this Final Judgment by certified check, bank cashier’s 20 check, or United States postal money order payable to the Securities and Exchange 21 Commission. The payment shall be delivered or mailed to the Office of Financial 22 Management, Securities and Exchange Commission, Operations Center, 6432 23 General Green Way, Mail Stop 0-3, Alexandria, Virginia 22312, and shall be 24 accompanied by a letter identifying MRI and Flores as defendants in this action; 25 setting forth the title and civil action number of this action and the name of this 26 Court; and specifying that payment is made on behalf of MRI or Flores pursuant to 27 this Final Judgment. A copy of the letter and payment shall also be delivered or 28 mailed to counsel for the Commission in this action at the Los Angles Regional 4 1 Office, located at 5670 Wilshire Boulevard, 11th Floor, Los Angeles, California 2 90036, identifying the enforcement action as LA-3461 and providing the paying 3 defendant’s Social Security Number and/or Tax Identification Number. 4 Defendants MRI and Flores shall pay post-judgment interest on any delinquent 5 amounts pursuant to 28 U.S.C. § 1961. The Commission shall remit the funds paid 6 pursuant to this paragraph to the United States Treasury. 7 VIII. 8 IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that this 9 10 Court shall retain jurisdiction of this matter for the purpose of enforcing the terms of this Final Judgment. 11 12 13 14 IX. There being no just reason for delay, pursuant to Fed. R. Civ. P. 54(b), the Clerk is ordered to enter this Final Judgment forthwith and without further notice. IT IS SO ORDERED. 15 16 17 Dated: September 9, 2009 ___________________________________ HONORABLE OTIS D. WRIGHT II UNITED STATES DISTRICT JUDGE 18 19 20 21 22 23 24 25 26 27 28 5

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