Thursday March 30, 6:52 pm Eastern Time
Tokyo Joe seeks dismissal of SEC fraud charges
By Jeremy Pelofsky
WASHINGTON, March 30 (Reuters) - Lawyers for the creator of the Tokyo Joe
investment Web site filed a motion to dismiss fraud charges brought by the Securities and
Exchange Commission claiming free speech rights and that their client did not violate
securities laws.
The SEC has accused Yun Soo Oh Park, also known as Tokyo Joe, and his company,
Tokyo Joe's Societe Anonyme with taking $1.1 million in fees from members in exchange for
investment advice, daily stock picks and access to a private chat room where he allegedly promoted stocks without disclosing
his interests.
The charges against Park and his company ``attacks only the editorial content of the tokyo.com website' which, based on
previous case law, ``constitutes fully protected, noncommercial speech,' according to the motion filed on March 28 and was
made available to Reuters on Thursday.
Additionally, Park expressed his own ideas and opinions over the Internet which does not constitute investment advice and that
he owed no fiduciary duty to the subscribers of his Web site, the motion said.
The defendant resides in New York and operates his company from there. The SEC said he never registered with the agency
as an investment adviser.
Members also received an electronic mail message that detailed his daily stock picks and gave other investment advice, the
SEC said. He posted 10 to 20 messages a day to a members-only part of his Web site and e-mailed the same information to
members randomly throughout any given day.
``Park does not advise S.A. subscribers on an individualized basis to buy, sell or hold securities,' said the motion filed with the
U.S. District Court for the Northern District of Illinois.
SEC Chairman Arthur Levitt told Reuters in January that the First Amendment was ``not a shield for fraud' but conceded that it
may take the judicial process to make that clear.
The SEC will have until April 11 to file its response to the motion and the defendants will have until April 18 to file a reply to the
agency's response before the judge will make a ruling.
The SEC is seeking to force Park and his company to disgorge ill-gotten gains, including prejudgment interest as well as impose
civil penalties and bar the two from engaging in these activities in the future. |
