Securities and Exchange Commission v. GexCrypto et al, No. 2:2023cv00191 - Document 5 (D. Nev. 2023)
Court Description: ORDER Granting 3 -4 Stipulated/Consent Judgment. Signed by Judge Jennifer A. Dorsey on 3/1/2023. (Copies have been distributed pursuant to the NEF - JQC)
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Securities and Exchange Commission v. GexCrypto et al Doc. 5 Case 2:23-cv-00191-JAD-BNW Document 5 Filed 03/01/23 Page 1 of 6 UNITED STATES DISTRICT COURT DISTRICT OF EV ADA 2 3 4 SECURITIES AND EXCHANGE COMMISSION, Plaintiff, 5 V. 6 7 8 Case No. 2:23-cv-00191-JAD-BNW GEXCRYPTO CORP. (a/k/a GexCrypto Global Trading Corp.) and EMILIANO S. RYN, ECF No. 3-4 Defendant. 9 10 II Order Granting Motion to Approve Stipulated Consent Judgment against GexCrypto Corp. 12 The Securities and Exchange Commission having filed a Complaint and Defendant 13 14 15 16 GexCrypto Corp. ("Defendant") 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 Final Judgment without admitting or denying the allegations of the Complaint (except as to 17 jurisdiction); waived findings of fact and conclusions of law; and waived any right to appeal I8 from this Final Judgment: 19 20 21 22 I. IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that Defendant is permanently restrained and enjoined from violating, directly or indirectly, Section I0(b) of the 23 Securities Exchange Act of 1934 (the "Exchange Act") [ 15 U.S.C. § 78j(b)] and Rule I 0b-5 24 promulgated thereunder [17 C.F.R. § 240.10b-5), by using any means or instrumentality of 25 26 27 28 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; Dockets.Justia.com Case 2:23-cv-00191-JAD-BNW Document 5 Filed 03/01/23 Page 2 of 6 (b) 2 necessary in order to make the statements made, in the light of the circumstances 3 under which they were made, not misleading; or 4 5 (c) 8 9 10 II 12 to engage in any act, practice, or course of business which operates or would operate as a fraud or deceit upon any person. 6 7 to make any untrue statement of a material fact or to omit to state a material fact 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 Final 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). 11. 13 14 15 16 17 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 18 means or instruments of transportation or communication in interstate commerce or by use of the 19 mails, directly or indirectly: 20 21 22 (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 23 24 made, in light of the circumstances under which they were made, not misleading; 25 or 26 27 28 (c) to engage in any transaction, practice, or course of business which operates or would operate as a fraud or deceit upon the purchaser. 2 Case 2:23-cv-00191-JAD-BNW Document 5 Filed 03/01/23 Page 3 of 6 IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, as provided in 2 3 4 5 6 Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also binds the following who receive actual notice of this Final 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). III. 7 8 9 10 11 12 IT IS HEREBY FURTHER 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 13 means or instruments of transportation or communication in interstate commerce 14 or of the mails to sell such security through the use or medium of any prospectus 15 or otherwise; 16 17 (b) Unless a registration statement is in effect as to a security, carrying or causing to 18 be carried through the mails or in interstate commerce, by any means or 19 instruments of transportation, any such security for the purpose of sale or for 20 delivery after sale; or 21 22 (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 24 or medium of any prospectus or otherwise any security, unless a registration 25 statement has been filed with the Commission as to such security, or while the 26 registration statement is the subject of a refusal order or stop order or (prior to the 27 28 effective date of the registration statement) any public proceeding or examination 3 Case 2:23-cv-00191-JAD-BNW Document 5 Filed 03/01/23 Page 4 of 6 under Section 8 of the Securities Act [ I 5 U .S.C. § 77h]. 2 3 4 5 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 Final Judgment by personal service or otherwise: (a) Defendant's 6 officers, agents, servants, employees, and attorneys; and (b) other persons in active concert or 7 participation with Defendant or with anyone described in (a). 8 9 10 11 IV. lT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that Defendant, jointly and severally with Defendant Emiliano S. Ryn, is liable for disgorgement of $825,994.37, 12 pursuant to Section 21(d)(7) of the Exchange Act [ 15 U.S.C. § 78u(d)(7)], representing net 13 profits gained as a result of the conduct alleged in the Complaint, together with prejudgment 14 interest thereon in the amount of $187,567.87, and a civil penalty in the amount of $1, 000,000.0 15 16 17 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)]. Defendant shall satisfy this obligation by paying 18 $2, 013,562.24 to the Securities and Exchange Commission within 30 days after entry of this 19 Final Judgment. 20 21 22 23 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 24 http://www.sec.gov/about/offices/ofm.htm. Defendant may also pay by certified check, bank 25 cashier's check, or United States postal money order payable to the Securities and Exchange 26 Commission, which shall be delivered or mailed to 27 28 Enterprise Services Center 4 Case 2:23-cv-00191-JAD-BNW Document 5 Filed 03/01/23 Page 5 of 6 2 3 4 5 6 Accounts Receivable Branch 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; GexCrypto Corp. as a defendant in this action; and specifying that payment is made pursuant to this Final Judgment. 7 Defendant shall simultaneously transmit photocopies of evidence of payment and case 8 identifying information to the Commission ·s counsel in this action. By making this payment. 9 IO II 12 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 may enforce the Court's judgment for disgorgement and prejudgment 13 interest by using all collection procedures authorized by law, including, but not limited to, 14 moving for civil contempt at any time after 30 days following entry of this Final Judgment. 15 16 17 The Commission may enforce the Court's judgment for penalties by the use of all collection procedures authorized by law, including the Federal Debt Collection Procedures Act, 18 28 U.S.C. § 300 I et seq., and moving for civil contempt for the violation of any Court orders 19 issued in this action. Defendant shall pay post judgment interest on any amounts due after 30 20 days of the entry of this Final Judgment pursuant to 28 U.S.C. § 196 I. The Commission shall 21 22 23 24 hold the funds, together with any interest and income earned thereon (collectively, the "Fund"), pending fu11her order of the Court. The Commission may propose a plan to distribute the Fund subject to the Court's 25 approval. Such a plan may provide that the Fund shall be distributed pursuant to the Fair Fund 26 provisions of Section 308(a) of the Sarbanes-Oxley Act of 2002. The Court shall retain 27 28 jurisdiction over the administration of any distribution of the Fund and the Fund may only be 5 Case 2:23-cv-00191-JAD-BNW Document 5 Filed 03/01/23 Page 6 of 6 disbursed pursuant to an Order of the Court. 2 3 4 5 Regardless of whether any such Fair Fund distribution is made, amounts ordered to be paid as civil penalties pursuant to this Judgment shall be treated as penalties paid to the government for all purposes, including all tax purposes. To preserve the deterrent effect of the 6 civil penalty, Defendant shall not, after offset or reduction of any award of compensatory 7 damages in any Related Investor Action based on Defendant's payment of disgorgement in this 8 9 10 11 action, argue that it is entitled to, nor shall it further 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''). lf the court in any Related Investor Action grants such 12 a Penalty Offset, Defendant shall, within 30 days after entry of a final order granting the Penalty 13 Offset, notify the Commission's counsel in this action and pay the amount of the Penalty Offset 14 15 16 17 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 Judgment. For purposes of this paragraph, a "Related Investor 18 Action" means a private damages action brought against Defendant by or on behalf of one or 19 more investors based on substantially the same facts as alleged in the Complaint in this action. 20 21 22 23 24 25 26 V. 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 Final Judgment., and the stipulated consent judgment against Gexcrypto Corp. [ECF No. 3] is GRANTED. Dated: ------March 1, 2023 UNITED STATES DISTRICT JUDGE 27 28 6
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