Goldberg Made Illegal Touts Regarding Las Vegas Entertainment
In Internet Postings in September And October 1999
46. Goldberg provided "financial public relations" services pursuant to agreements with Las Vegas Entertainment. Between February and September 1999, Las Vegas Entertainment issued 85,000 shares to Goldberg.
47. Between September 23 and October 5, 1999, Goldberg made a total of 14 touts relating to the securities of Las Vegas Entertainment. These touts appeared as postings on several Internet bulletin boards, including those operatedby Raging Bull, Silicon Investor, and Yahoo Finance. Most of the touts described the $190 million "capital infusion" from investors.
48. The touts discussed Las Vegas Entertainment's securities: all postings to Raging Bull included current share price data; some postings included current and specific market information regarding trading in Las Vegas Entertainment's securities; and most postings stated that Las Vegas Entertainment was "an excellent speculation." Goldberg signed his name and listed his telephone number in all postings. Goldberg invited investors to call him if they had "any questions."
49. In publishing these touts, Goldberg failed to disclose that he had received consideration of 85,000 shares from Las Vegas Entertainment.
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FOURTH CLAIM FOR RELIEF UNDISCLOSED COMPENSATION FOR STOCK TOUTING Violations of Section 17(b) of the Securities Act
(Against Defendant Goldberg) 60. Paragraphs 1 through 49 are realleged and incorporated herein by reference. 61. Defendant Goldberg, by engaging in the above conduct, by use of means or instruments of transportation or communication in interstate commerce, or by the use of the mails, published, gave publicity to, or circulated notices, circulars, advertisements, newspapers, articles, letters, investment services or communications which, though not purporting to offer securities for sale, described such securities for consideration received or to be received, directly or indirectly, from an issuer, underwriter, or dealer, without fully disclosing the receipt, whether past or prospective, of such consideration and the amounts thereof. 62. By reason of the foregoing, defendant Goldberg has violated, and unless enjoined will continue to violate, Section 17(b) of the Securities Act, 15 U.S.C. § 77q(b). PRAYER FOR RELIEF WHEREFORE, the Commission respectfully requests that the Court: I. Issue findings of fact and conclusions of law that defendants Las Vegas Entertainment, Corazzi, Sambus, and Goldberg committed the violations alleged and charged herein. II. Issue final judgments of permanent injunction, in a form consistent with Fed. R. Civ. P. 65(d), enjoining: a) Las Vegas Entertainment, Corazzi, and Sambus, from violating Sections 10(b), 13(a), and 14(a) of the Exchange Act, 15 U.S.C. §§ 78j(b), 78m(a), and 78n(a), and Rules 10b-5, 12b-20, 13a-13, and 14a-9 thereunder, 17 C.F.R. §§ 240.10b-5, 240.12b-20, 240.13a-13, and 240.14a-9; and b) Goldberg from violating Section 17(b) of the Securities Act. III. Enter an order, pursuant to Section 21(d)(2) of the Exchange Act, 15 U.S.C. § 78u(d)(2), prohibiting Corazzi and Sambus from acting as an officer or director of any issuer that has a class of securities registered pursuant to Section 12 of the Exchange Act, 15 U.S.C. § 781, or that is required to file reports pursuant to Section 15(d) of the Exchange Act, 15 U.S.C. § 78o(d). IV. Enter an order directing Goldberg to pay civil penalties under Section 20(d) of the Securities Act, 15 U.S.C. § 77t(d), and Corazzi and Sambus to pay civil penalties under Section 21(d)(3) of the Exchange Act, 15 U.S.C. § 78u(d)(3). V. Retain jurisdiction of this action in accordance with the principles of equity and the Federal Rules of Civil Procedure in order to implement and carry out the terms of all orders and decrees that may be entered, or to entertain any suitable application or motion for additional relief within the jurisdiction of this Court. VI. Grant such other and further relief as this Court may determine to be just and necessary. DATED: October 8, 2002 _____________________
Janet R. Rich
Attorney for Plaintiff
Securities and Exchange Commission sec.gov
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