Free Permanent Injunction - District Court of Colorado - Colorado

Case 1:03-cv-01338-REB-MEH

Document 119

Filed 11/28/2005

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO Judge Robert E. Blackburn

Civil Action No.: 03-cv-01338-REB-OES SECURITIES AND EXCHANGE COMMISSION, Plaintiff, v. GLEN W. HILKER, and LARRY M. BAKER, Defendants, TRICORD LLC and BROOKSHIRE DEVELOPMENT CO. LLC, Relief Defendants.

ORDER OF PERMANENT INJUNCTION AS TO LARRY M. BAKER Blackburn, J. The Securities and Exchange Commission having filed a Complaint and Defendant Larry M. Baker (" Defendant" having entered a general appearance; ) consented to the Court' jurisdiction over Defendant and the subject matter of this s action; consented to entry of this Order of Permanent Injunction without admitting or denying the allegations of the Complaint (except as to jurisdiction); waived findings of fact and conclusions of law; and waived any right to appeal from this Order of Permanent Injunction: I. IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that Defendant and Defendant' agents, servants, employees, attorneys, and all persons in active concert s or participation with them who receive actual notice of this Order of Permanent

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Injunction by personal service or otherwise are permanently restrained and enjoined from violating, directly or indirectly, Section 10(b) of the Securities Exchange Act of 1934 (the " Exchange Act" [15 U.S.C. § 78j(b)] and Rule 10b-5 promulgated thereunder ) [17 C.F.R. § 240.10b-5], by using any means or instrumentality of interstate commerce, or of the mails, or of any facility of any national securities exchange, in connection with the purchase or sale of any security: (a) (b) to employ any device, scheme, or artifice to defraud; to make any untrue statement of a material fact or to omit to state a

material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading; or (c) to engage in any act, practice, or course of business which operates or

would operate as a fraud or deceit upon any person. II. IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that Defendant and Defendant' agents, servants, employees, attorneys, and all persons in active concert s or participation with them who receive actual notice of this Order of Permanent Injunction by personal service or otherwise are permanently restrained and enjoined from violating Section 17(a) of the Securities Act of 1933 (" Securities Act" [15 U.S.C. § ) 77q(a)] in the offer or sale of any security by the use of any means or instruments of transportation or communication in interstate commerce or by use of the mails, directly or indirectly: (a) (b) to employ any device, scheme, or artifice to defraud; to obtain money or property by means of any untrue statement of a

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material fact or any omission of a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading; or (c) to engage in any transaction, practice, or course of business which

operates or would operate as a fraud or deceit upon the purchaser. III. IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that Defendant is liable for disgorgement of $960,433.00, representing profits gained as a result of the conduct alleged in the Complaint, together with prejudgment interest thereon in the amount of $124,338.93, for a total of $1,084,771.90. The Commission may enforce the Court' judgment for disgorgement and prejudgment interest by moving for civil s contempt (and/or through other collection procedures authorized by law) at any time after ten days following entry of this Order of Permanent Injunction. In response to any such civil contempt motion by the Commission, the defendant may assert any legally permissible defense. Payments under this paragraph shall be made to the Clerk of this Court, together with a cover letter identifying Defendant Larry M. Baker as a defendant in this action; setting forth the title and civil action number of this action and the name of this Court; and specifying that payment is made pursuant to this Order of Permanent Injunction. Defendant shall simultaneously transmit photocopies of each such payment and letter to the Commission' counsel in this action. Defendant relinquishes all legal s and equitable right, title, and interest in such payments, and no part of the funds shall be returned to Defendant. The Clerk shall deposit the funds into an interest bearing account with the Court Registry Investment System (" CRIS" or any other type of )

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interest bearing account that is utilized by the Court. These funds, together with any interest and income earned thereon (collectively, the " Fund" shall be held in the ), interest bearing account until further order of the Court. In accordance with 28 U.S.C. § 1914 and the guidelines set by the Director of the Administrative Office of the United States Courts, the Clerk is directed, without further order of this Court, to deduct from the income earned on the money in the Fund a fee equal to ten percent of the income earned on the Fund. Such fee shall not exceed that authorized by the Judicial Conference of the United States. The Commission may propose a plan to distribute the Fund subject to the Court' approval including a plan pursuant to the Fair Fund s provisions of Section 308(a) of the Sarbanes-Oxley Act of 2002. Defendant shall pay post-judgment interest on any delinquent amounts pursuant to 28 U.S.C. § 1961. IV. IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that the Court shall determine the amount of the civil penalty pursuant to Section 20(d) of the Securities Act [15 U.S.C. § 77t(d)] and Section 21(d)(3) of the Exchange Act [15 U.S.C. § 78u(d)(3)] upon motion by the Commission. In connection with the Commission' motion for civil s penalties: (a) Defendant will be precluded from arguing that he did not violate the federal securities laws as alleged in the Complaint; (b) Defendant may not challenge the validity of the Consent or the Order of Permanent Injunction; (c) solely for the purposes of such motion, the allegations of the Complaint shall be accepted as and deemed true by the Court; and (d) the Court may determine the issues raised in the motion on the basis of affidavits, declarations, excerpts of sworn deposition or investigative testimony,

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and documentary evidence, without regard to the standards for summary judgment contained in Rule 56(c) of the Federal Rules of Civil Procedure. V. IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that the Consent is incorporated herein with the same force and effect as if fully set forth herein, and that Defendant shall comply with all of the undertakings and agreements set forth therein. VI. IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that this Court shall retain jurisdiction of this matter for the purposes of enforcing the terms of this Order of Permanent Injunction. VII. There being no just reason for delay, pursuant to Rule 54(b) of the Federal Rules of Civil Procedure, the Clerk is ordered to enter this Order of Permanent Injunction forthwith and without further notice. Dated November 28, 2005, at Denver, Colorado. BY THE COURT: s/ Robert E. Blackburn Robert E. Blackburn United States District Judge

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