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Course Materials "Securities Law and the Internet" (Note: Not all of This Reading is Required) |
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Securities Law and the Internet Course Materials (Note: Not All of This Reading is Required, Some Parts Are Just For Reference)
Adjunct Professor
Georgetown University Law Center Graduate Program, Spring 2004 Wednesday Evenings, 5:45-7:45, Room 200 |
| Table of Contents |
| Regulatory Materials |
1. Various Relevant SEC Statutes, Rules and Regulations
2. Certain SEC Interpretive Releases and related no-action letters
3. Certain Online Trading Facility no-action letters
4. Certain Roadshow Related no-action letters and Other Letters
5. Certain Private Market Access no-action letters
6. Certain Investment Management no-action letters
7. Certain Broker-Dealer no-action letters
| Enforcement Materials |
8.
Various SEC Internet-Related Enforcement Actions
9. SEC Enforcement Actions: Certain Online Phony Offerings
10. SEC Enforcement Actions: Certain Internet-related Pump-and-Dump Schemes
11. SEC Enforcement Actions: Certain Online Momentum Trading Sites
12. SEC Enforcement Actions: Certain Online Impersonations
13. SEC Enforcement Actions: Certain Online Stock Recommendation Sites
14. SEC Enforcement Actions Involving Online Auction Sites
15. SEC Enforcement Actions: "Internet Countries"
16. SEC Enforcement Actions: Certain Online Newsletter Sites s
17. SEC Enforcement Actions: Certain Online "Pre-IPO" Frauds
18. SEC Enforcement Actions: Certain Online Pyramid Schemes
19. SEC Enforcement Actions: Certain spam-related Matters
20. SEC Internet-Related Enforcement Matters: Some Ancient History
21. SEC Internet Sweep Materials
| General Materials |
22.
Internet Reference Materials
23. Online Related SRO Materials
24. Certain Electronic Privacy-Related and Jurisdiction-Related Statutes/Cases
| Regulatory Materials |
1. Various Relevant SEC Statutes, Rules and Regulations
Provisions From the Securities Act of 1933
Provisions From the Securities and Exchange Act of 1934
2. Certain Internet-Related SEC Interpretive Releases and Related no-action letters
| Release No. | Date | Details |
| 34-55146 | Jan. 22, 2007 | Final Rule: Internet Availability of Proxy Materials. Provides guidance on Internet-related amendments to proxy rules. [Release Nos. 34–55146; IC–27671, File No. S7–10–05]. |
33-8591 Press Release See also: Proposed Rule Release No.33-8501 Comments |
Jul 19, 2005
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Final Rule: Securities Offering Reform. Provides guidance relating to the provision of information about issuers to investors through the Internet. [Release Nos. 33–8591; 34–52056; IC–26993; FR–75, International Series Release No. 1294 and File No. S7–38–04]. |
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(Adopting)
(Proposing)
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Jan. 20, 2003
Apr. 12, 2002 |
Exemption for Certain Investment Advisers Operating over the Internet. File No. S-7-10-02. Comments Due: Comments must be received before June, 6, 2002. |
| 34-42974 | June 22, 2000 | Final Rule: Privacy of Consumer Financial Information (Regulation S-P). Provides guidance on Internet disclosure. [Release Nos. 34-42974, IC-24543, IA-1883; File No. S7-6-00]. |
| 33-7985 | June 14, 2001 | SEC Interpretation: Application of the Electronic Signatures in Global and National Commerce Act to Record Retention Requirements Pertaining to Issuers under the Securities Act of 1933, Securities Exchange Act of 1934 and Regulation S-T. Effective date of interpretation: June 21, 2001. [Release Nos. 33-7985, 34-44424; 35-27419; IC-25003]. |
| 33-7856 | Apr. 28, 2000 | Interpretation; Use of Electronic Media: April 28, 2000. Effective date of interpretation: May 5, 2000. Comments due: June 19, 2000. [Release Nos. 34-42728, File No. S7-11-00]. |
| 33-7516 | Mar. 23, 1998 | Interpretation; Statement of the Commission Regarding Use of Internet Web Sites to Offer Securities, Solicit Securities Transactions, or Advertise Investment Services Offshore. March 23, 1998. Effective date of interpretation: March 23, 1998. [Release No. 33-7516]. |
| 33-7288 | May 9, 1996 | Interpretation; Solicitation of Comments; Use of Electronic Media by Broker-Dealers, Transfer Agents, and Investment Advisers for Delivery of Information; Additional Examples under the Securities Act of 1933, Securities Exchange Act of 1934 and Investment Company Act of 1940. May 9, 1996. Effective date of interpretation: when published in the Federal Register; Comments due: 45 days after publication in the Federal Register. [Release No. 33-7288; File No. S7-13-96]. |
| 33-7233 | Oct. 6, 1995 | Use of Electronic Media for Delivery Purposes; Action: Interpretation; Solicitation of comment. 17 CFR Parts 231, 241 and 271 [Release No. 33-7233; 34-36345; IC-21399 File No. S7-31-95]. |
Baltimore Gas & Electric (January 1997)
3. Certain Online Trading Facility no-action letters
Real Goods Trading Corp (June 24, 1996))
Flamemaster (October 29, 1996))
Spring Street Letter & Recommendation (Aprril 17, 1996)
Arizona Stock Exchange (January 15, 1997)
Internet Capital Corp (December 24, 1997)
Internet Capital Corp (January 1998)
4. Certain Roadshow Related no-action letters
| Private Financial Network, (Mar. 12, 1997) |
| NetRoadshow, Inc., (Sep. 08, 1997) |
| Bloomberg L.P., (Dec. 01, 1997) |
| NetRoadshow, Inc., (Jan. 30, 1998) |
| Thomson Financial Services, Inc., (Sep. 04, 1998) |
| **NetRoadshow: Analyst Premarketing Presentations, (Nov. 1998) |
| **NetRoadshow: Accredited Investors, (Jan. 1999) |
| Activate.net Corp., (Sep. 21, 1999) |
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Charles Schwab & Co., Inc. I, (Nov. 15, 1999) Charles Schwab & Co., Inc. II, (Feb. 9, 2000) See also: In the Matter of Goldman Sachs and Co. (regarding gun-jumping) **These are NOT SEC no-action letters but rather letters from NetRoadshow to the SEC regarding NetRoadshow's characterization of telephone conversations with the SEC staff. |
5. Certain Private Market Access no-action letters
Venture Listing Services (June 15, 1994)
Angel Capital Network (October 25, 1996)
American Brewing Company Incorporated (January 27, 1999)
Simply Stocks.com (January 19, 1999)
6. Certain Investment Management no-action letters
International Association of Financial Planning (June 1, 1998)
Lamp Technologies I (May 29, 1997)
Lamp Technologies II (May 29, 1998)
Progressive Technology Inc. (October 11, 2000)
7. Certain Broker-Dealer no-action letters
Charles Schwab & Co. Inc. I (November 27, 1996)
Securities Transfer Association (October 24, 1997)
Streetline, Inc. (June 4, 2002)
*Related no-action letter: Security Pacific Brokers., Inc. (March 5, 1985)
| Enforcement Materials |
8. Various SEC Internet-Related Enforcement Actions
| Van Dinh (hacking, identity theft and securities fraud) | |
| Kin H. Lee (after hours trading/manipulation) | |
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John Freeman, James Cooper, Benton Erskine, Anthony Seminara, Norman Lehrman, Linda Karlsen, Timothy Siemers, Norman Grossman, Lawrence Schwartz, Michael Akva, Robert Fricker, Richard Zelman, Bradley Burke, Benjamin Cooper, Chad L. Conner, Deon Benson, Gordon K. Allen, Jr., Jon Geibel, and William H. Borders II (unlawful insider trading) |
| LR-17037 | Linville Group, LLC, et al. (phony mutual fund) |
| LR-16947 | Sean Edward St. Heart (cybersmear) |
| Tutornet.com Group, Inc. and Euburn R.A. Forde (false SEC filings) | |
| 34-43382 | Alex Moore Co., Inc., Livetrade.com, Inc., and Michael Weissman (unregistered broker-dealer) |
9. SEC Enforcement Actions:
Certain Online Phony Offerings
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Blue Square, Westwood Holdings, Viktor Novosselov (AKA David Markovitz), Igor Malyar (AKA George Falcone) |
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Z-Par Holdings, Inc., Z-Par Investment Fund II, Larry Michael Parrish, Michael Edward Zimmerman, defendants, and Eduard Akopian A/K/A Edward Akopian, and Capital Ban Corp., A California Corporation, relief defendants. |
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Hubert A. Jeffreys, a/k/a Hugh Jeffreys, Earthboard Sports USA, Inc., Timothy F. Bell and Tracy A. Edwards |
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| 34-49657 |
William Lyons (purported "prime bank investments") |
| Invest Better 2001, Cole A. Bartiromo, and John/Jane Does 1-10 (phony offering/manipulation) | |
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Interactive Products and Services, Inc., and Matthew P. Bowin |
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| Make It Reel Productions, Inc., Cine Star, Inc., Joseph Rubbo, Angela Rubbo (Sr.), Angela Rubbo (Jr.), Pasquale Rubbo, Nicholas Rubbo, and Peter D. Ragofsky | |
| LR-17400 |
Harral Dunbar, Jr., Individually and d/b/a Ghost International (purported "high yield investments") |
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*Related Case: SEC v. Lauer (1994) |
Clif Goldstein, formerly known as Clifford Dixon Noe, Paul Howe Noe, also known as Paul Noe Randall, Carolyn M. Kaplan, Noel Alelov, Russell B. Gerstein, Nuell W. Paschal, Great American Trust Company, Inc., and Great American Trust Corporation, Inc. (prime bank fraud) |
| LR-16690 | Houston Texans NFL Football Team Holding Co. and Edgar A. Guilbeau |
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SEC v. Roor, et al (99 Civ. 3372, 2004 U.S. Dist. LEXIS 17416 (S.D.N.Y. August 30, 2004) (Baer, J.) (SEC’s motion for summary judgment against two defendants granted in securities fraud case; finds defendants acted recklessly and draws adverse inference against them based on Fifth Amendment assertion; also holds that one defendant’s criminal conviction constitutes collateral estoppel; orders permanent injunctions, disgorgement, and prejudgment interest as to both defendants, and $100,000 civil penalty against one defendant). ) |
Peter Roor (Individually and D/B/A Oxford Savings Club, Ltd. and Manumit Unlimited), Ronald L. Templin (Individually and D/B/A American Leadership Network, Saratoga Holdings Llc, Secured Private Placements, The 650 Club,Internet Marketing Partners and Private Party Loan Program), and Laurie Elizabeth Weiss. |
10. SEC Enforcement Actions:
Certain Internet-related Pump-and-Dump Schemes
| SEC v. Shawn Casius, Logic's Consulting, Inc., Steven R. Wright, International Solutions, Inc., Peter Jessop, Socius Holdings, Ltd., and SIGF SA (emergency asset freeze concerning concerted market manipulation of the stock of Cameron International) |
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2003 Summary Judgment Decision
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Arash Aziz-Golshani, Hootan Melamed and Allen Derzakharian (NEI Webworld) |
| Refael Shaoulian, Samuel Shaoulian (Universal Standard Healthcare, Inc., Classica Group, Inc. and Firetector, Inc.) |
| Stephen C. Sayre, Independent Financial Reports, Inc. and Silver Screen Industries, Inc. (Econnect) |
| Jonathan Lebed (Manchester Equipment Company, Inc., Just Toys, Inc., Yes Entertainment, Inc., Fotoball USA, Inc., Man Sang Holdings, Inc., West Coast Entertainment, Inc., Havana Republic, Inc., Classica Group, Inc. and Firetector, Inc.) |
| Charles O. Huttoe, Huttoe & Associates, Inc., Word Corporation, National Trading Services, Inc., Karen Purvis, also known as Karen Purvis Huttoe, Tammy Jo Perkins, Josephine Brooks, SGA Goldstar Research Inc., Theodore R. Melcher, Jr., Shannon B. Terry, Systems of Excellence, Inc, Alpha Securities Ltd., and Dunbar Holdings Ltd., (Systems of Excellence) |
| LR-17265 | Spectrum Brands Corp., Saverio (Sammy) Galasso III, David Hutter (a/k/a David Green), Charlie Dilluvio and Michael J. Burns (Anthrax exploitation) |
| LR-17104 | American Healthcare Providers, Inc., Arthur W. Wheeler, Lars M. Kram, Angel L. Lorie Jr., Luis F. Lorie, and Michael Anthony Lester (manipulation/via, inter alia, message boards) |
| 34-45474 | David B. Gosse (PortalZone -- false press releases) |
11. SEC Enforcement Actions:
Certain Online Momentum Trading Sites
LR-16461 Douglas Colt, et al
Complaint
LR-17052 Thomas Carter
LR-16679
LR-17704
12. SEC Enforcement Actions:
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Michael O'Grady, Peter Cahill, David E. Wittimore, et al (so called "vicemail" stock manipulation scheme; joint filing with District of Columbia U.S. Attorney's office)
Related matter: SEC v. Yafa and Pickens, et al |
| LR-18614 | Nikolai Safavi (Sina Corporation) |
| LR-17427 | Mark Sendo and Internet Money.com, Inc. (phony credentials) |
| James Sheret, Jr. and Glenn E. Conley; (see also "SEC Charges Two People With Internet Stock Manipulation Scheme...") (AOL) | |
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Ned C. Sneiderman (Viasource) |
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| 34-46108 | Benjamin Snyder (Viragen) |
| Mark S. Jakob (Emulex) | |
| Fred Moldofsky (Lucent) |
| LR-16363 | Leszkek Zbierajewski (Bid.com) |
| Gary D. Hoke, Jr. (Pairgain) |
13. SEC Enforcement Actions:
Certain Online Stock Recommendation Sites
LR-16925 Yun Soo Oh Park a/k/a Tokyo Joe
LR-16399 and Tokyo Joe's Societe Anonyme Corp.
*Related Opinions:
SEC v. Agora, Inc. (January 2004)
Lowe, et al v. SEC (1985)
LR-16475 DynamicDaytrader.com LLC and David A. Rudnick
34-42737 Genesis Trading and Robert Garganese
14. SEC Enforcement Actions Involving Only §5 Violations
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In the Matter of Ford Motor Credit Company (Unlawful marketing of $7.3 billion of online debt securities in so-called "corporate money market accounts") |
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Richard L. Davis, J.R. Hoff and Louis P. Sitaras (online auction site violations) |
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| 34-51087 | Courtside Products, Inc. Trading Suspension
See also
Order (Trading
Suspension FAQ) Commanche Properties, Inc. Trading Suspension See also Order (Trading Suspension FAQ) |
15. SEC Enforcement Actions: "Internet Countries"
LR-16368 World Financial & Investment Co., Inc. and Victor M.
Wilson (involving "Melchizedek")
LR-16110 Lazarus R. Long (a/k/a Howard Turney) ("New Utopia")
LR-16780 Robert F. Moore ("The Kingdom of Enenkio")
16. SEC Enforcement Actions:
Certain Online Newsletter Sites
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Agora, Inc., Pirate Investor, LLC and Frank Porter Stansberry |
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| LR-17311 | James E. Franklin, Dieter Raabe, Samuel Wolanyk, Vector Keel Ltd., Initial Public Offering Consultants, Inc., Net Income and Avalon Trust |
| LR-17053 | Jared Ray Leisek and Byron John Leisek |
| 34-44881 | Daniel J. Murphy d/b/a Financial Picks |
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*Related Cases SEC v. Corporate Relations Group (2003) SEC v. Wenger (10th Circuit, 2005) (see also Wenger original district court decision)
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Liberty Capital Group, Inc. and Jason A. Greig |
| In the Matter of Presstek, Inc., Respondent |
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*Related Matters: Regulation FD Actions Press Release (November 25th, 2002) Siebel Systems Litigation Release Siebel Systems Adminstrative Order
SEC v. Siebel
Systems, Inc., No. 04 CV 5130 (GBD) (S.D.N.Y. Aug. 31, 2005) (Daniels,
J.) (grants defendants’ motion to dismiss in Regulation FD case, holding
that positive statements by Siebel senior officer at private meetings with
institutional investors, which the SEC alleged contrasted with public
statements made by Siebel during conference calls, were neither non-public
nor material). |
17. SEC Enforcement Actions: Certain Online "Pre-IPO" Frauds
| LR-17171 | Nueworld.com Commerce, Inc., and Timothy C. Ringgenberg |
| LR-17207 | Steven Goldsborough and William Goldsborough, individually and doing business as The Liquibuyers Group |
| LR-16700 | 1stBuy.com, Inc., and Roger D. Pringle |
18. SEC Enforcement Actions: Certain Online Pyramid Schemes
| LR-16665 | Le Club Privé S.A., Zdenek Kieslich, Ron Zvi Mendelson, Eugene G. Chusid, Le Baron Solidarity, S.A., Le Baron Insured Fund, Le Baron High Income Fund, Le Baron High Yield Fund, Defendants; and Rishon Bank (SC), Rishon Financial Services, S.A., Rishon Investment Corp, M&R Bank Corp., World Wide Trading Group of Companies, Inc., World US Financial Services, Inc., Boris G. Chusid, Citadel Bank & Trust Inc., Relief Defendants |
| SG Limited, d/b/a Stockgeneration, et al. |
| LR-17537 | Gold-Ventures Club and Alexander Khamidouline, d/b/a www.gold-ventures.net |
19. SEC Enforcement Actions: Certain Spam-Related Matters
33-8311 33-8310 33-8309 33-8306 |
Energy & Engine Technology Corporation and ProActive Computer Services, Inc. First Capital International, Inc., Alexander Genin and Edwin M. Koziol Research Capital, LLC, Carl L. Smith, III, Richard Craig Hall, IR Specialists, Inc. and Wayne H. Jenkins EquityAlert.com, Inc., Innotech Corporation, Bhupinder S. Mann, Harmel S. Rayat, T&G2, Inc. and Virilitec Industries, Inc. |
| Discover Capital Holdings Corp., et al | |
| Decision | In the Matter of John Christopher McCamey and Sierra Equity Partners, LP |
| Dean S. Thomassen | |
| K.C. Smith | |
| Frank J. Custable, Jr., et al | |
| C. Jones & Company, Carter Allen Jones, Timothy J. Miles, Gaylen P. Johnson and Jonathan Curshen | |
| Samuel Meltzer | |
| Rodona Garst | |
| LR-17721 | Paul A. Spray, Thomas E. Loyd, Marc Barhonovich, et al |
| LR-17503 | U.S. Funding Corporation, Capital Concept Marketing, Angelica-Gwinnett and Charles Fremer |
| Mark E. Rice d/b/a Primex Capital | |
| LR-17396 | David Allen Lester |
| LR-17442 | New World Web Vision.com, Inc., Capital Corp Investments International, Inc. and Dwight D. Dubose |
| LR-17350 |
New Energy Corp., Tor Ewald, Geneva Financial Ltd., Marcelino Colt aka Marcelino Colt Vasquez, Magnum Financial, LLC, Michael S. Manahan, BLD Trust, Barclay Davis, Loretta Davis, Burke T. Maxfield, York Chandler, and Hector Campa Acedo |
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Steven Hourmouzis and Wayne Loughan (Rentech)
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| LR-15959 | Francis Tribble and Sloane Fitzgerald |
20. SEC Internet-Related Enforcement Matters: Some Ancient History