COURT JUDGMENT IN EAST DELTA RESOURCES CASE

In the following excerpt from the SEC web site the SEC got a summary judgment against in a securities fraud case:

‘The United States Securities and Exchange Commission announced today that on March 22, 2011, Judge Sandra Feuerstein of the United States District Court for the Eastern District of New York entered summary judgment in favor of the Commission on most of its claims against Mayer Amsel and his brother, David Amsel in a market manipulation case involving the securities of East Delta Resources Corp. Mayer Amsel is a securities fraud recidivist.
The Commission’s motion for summary judgment argued that from 2004 through at least 2006, the Amsels, in concert with several others and through their individual actions, artificially inflated the volume of market activity for, and in turn the price of, East Delta stock, and illegally sold East Delta shares that they received at little or no cost. The Commission’s summary judgment motion further argued that the Amsels together collected illegal profits of $1,322,703 from their manipulative conduct.
The summary judgment opinion grants the following relief: (1) a permanent injunction prohibiting both Amsels from violating Section 10(b) of the Securities Exchange Act of 1934 (Exchange Act) and Rule 10b-5 thereunder; (2) a permanent injunction prohibiting both Amsels from violating Section 17(a) of the Securities Act of 1933 (Securities Act); (3) a permanent injunction prohibiting David Amsel from violating Section 13(a) of the Exchange Act and Rules 12b-20, 13a-1, and 13a-13 thereunder; and (4) a permanent injunction prohibiting both Amsels from participating in an offering of penny stock, absent an explicit release from the Commission. The opinion reserved judgment on the issue of the Amsels’ liability for violations of Sections 5(a) and 5(c) of the Securities Act (together, Section 5), the question of whether to impose an officer and director bar against David Amsel, and what the appropriate judgment amount should be with respect to disgorgement, civil penalties, and prejudgment interest. Subsequently, the court entered a default judgment against David Amsel that permanently enjoined him from violating Section 5 of the Securities Act after he failed to appear at a bench trial that was held in the case on March 28, 2011.
The latest judgments against the Amsel brothers follow others entered in the same case within the past seven months against East Delta and its former CEO, Victor Sun. On September 22, 2010 and October 13, 2010, the court entered final judgments against East Delta and Sun, respectively. Both defendants settled with the Commission without admitting or denying the allegations against them.
A decision on Mayer Amsel’s Section 5 liability is still pending following the March 28, 2011 trial. A ruling on the officer and director bar against David Amsel and the monetary remedies sought by the Commission is expected after further briefing.
The SEC appreciates the assistance of the Quebec Autorité des marchés financiers (AMF) and the British Columbia Securities Commission (BCSC) in connection with the investigation leading to the litigation.”