Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

United States Securities and Exchange Commission v. Eydelman

United States District Court, D. New Jersey

October 11, 2017

UNITED STATES SECURITIES AND EXCHANGE COMMISSION, Plaintiff,
v.
VLADIMIR EYDELMAN and STEVEN METRO, Defendants.

          MEMORANDUM ORDER

          Michael A. Shipp, United States District Judge.

         This matter comes before the Court on Plaintiff United States Securities and Exchange Commission's (“SEC") Motion for Summary Judgment against Defendant Steven Metro ("Defendant" or "Metro"). (ECF No. 34.) Defendant filed opposition (ECF No. 38) and the SEC replied (ECF No. 40). The Court has carefully considered the parties' submissions and decides the matter without oral argument pursuant to Local Civil Rule 78.1. For the reasons set forth below, and for other good cause shown, Plaintiffs Motion for Summary Judgment is granted in part.

         On March 19, 2014, Metro was arrested on charges of insider trading. (SEC's Statement of Undisputed Material Facts "SOMF" ¶¶ 4, 51, ECF No. 35; Compl., ECF No. I.) The SEC filed its Complaint on the same day. (Id.) Due to the ongoing criminal proceedings, on September 16, 2014, the Court stayed the civil action. (ECF No. 18.) On November 12, 2015, Metro pleaded guilty to the criminal charges. (Def.'s Opp'n Br. 5.) On September 14, 2016, the Court sentenced Metro to forty-six months incarceration, three years supervised release, and a fine of $10, 000. (Id.) On October 5, 2016, the Court lifted the stay of the civil matter (ECF No. 25) and the parties engaged in a short period of discovery.

         The SEC Complaint alleges three counts of civil violations: (1) Section 10(b) of the Exchange Act, 15 U.S.C. § 78j(b) and Rule 10b-5 thereunder, 17 C.F.R. § 240.10b-5; (2) Section 17(a) of the Securities Act, 15 U.S.C. § 77q(a); and (3) Section 14(e) of the Exchange Act, 15 U.S.C. § 78n(e), and Rule 14e-3 thereunder, 17 C.F.R. § 240.14e-3. (Compl., ECF No.1.) On May 16, 2017, the SEC moved for summary judgment against Metro on all counts. (ECF No. 34.) The SEC seeks an injunction prohibiting future violations of the federal securities laws and a monetary penalty of more than two million dollars. (SEC's Moving Br. 8.)

         Although Defendant disputes certain underlying facts in the SEC's Complaint, [1]Defendant concedes that liability on Counts I and II are satisfied by his plea allocution. (Def.'s Opp'n Br. 7.) As to Count III, Defendant contends that the evidence on the record does not entitle the SEC to summary judgment on this Count. (Id. at 8-10.) Nevertheless, Metro is willing to stipulate to liability on Count III if an agreement can be reached with the SEC regarding the amount of the civil penalty, which Metro asserts should be ten thousand dollars. (Id. at 9-10, 17-22.) As to the injunction, Metro does not object to the SEC's request that Metro be permanently enjoined from engaging in future violations of the laws at issue.[2] (Id. at 10 n.7.)

         The core of this dispute is the amount of the civil penalty that should be imposed on Metro. The motion papers reflect that Metro and the SEC have engaged in settlement negotiations that have, thus far, been unsuccessful. (Id. at 9-10) According to Defendant, although Defendant is willing to concede liability, the SEC will not agree to a settlement, even solely as to the issue of liability, unless Metro assents to the truthfulness of each paragraph in the Complaint, including the paragraphs Metro contends are inaccurate. (Id.) Given the procedural posture of this matter, the Court finds that it may be beneficial for the parties to engage in a settlement conference with the Magistrate Judge to attempt to resolve the outstanding issues, including the appropriate amount of the civil penalty.

         Accordingly, for the reasons set forth above, and based on the Court's inherent power to control the matters on its docket, and for other good cause shown, IT IS on this 11 day of October, 2017 ORDERED that:

1. The Court GRANTS summary judgment to the SEC on Counts I and II of the Complaint.
2. The Court RESERVES on summary judgment as to Count III of the Complaint.
3. The Court RESERVES on the SEC's request for a permanent injunction.
4. Within seven days of the date of this Memorandum Order, the parties shall contact Magistrate Judge Bongiovani to schedule a settlement conference.
5. Should the settlement conference prove unsuccessful, within seven days of the conference, Plaintiff shall e-file correspondence to request reinstatement of the summary judgment motion as to any outstanding issues.

---------


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.