Message #1550 From:
MAILMAN Date: May 18, 2008 12:27:24 PM
More on John Edwards (long)
1. Defendant John Edwards ("Edwards") acknowledges having waived service of the Complaint in this action, enters a general appearance, and admits the Court's jurisdiction over him and over the subject matter of ths action.
2. Without admitting or denying the allegations of the Complaint (except as to personal and subject matter jurisdiction, which Edwards admits), Edwards hereby consents to the entry of the Judgment in the form attached hereto (the "Judgment") and incorporated by reference herein, which, among other things:
a. permanently restrains and enjoins Edwards from violating Sections 5(a) and 5(c) of the Securities Act of 1933 ("Securities Act"), 15 D.S.C. §§ 77e(a) and 77e(c); and
b. permanently and unconditionally bars Edwards from participation in any offering of penny stock, including engaging in activities with a broker, dealer, or issuer for purposes of issuing, trading, or inducing or attempting to induce the purchase or sale of any penny stock under Section 20(g) of the Securities Act, 15 D.S.C. § 77t(g).
3. Edwards agrees that the Court shall order disgorgement of ill-gotten gains, prejudgment interest thereon, and a civil penalty puruant to Section 20(d) of the Securities Act, 15 D.S.C. § 77t(d). Edwards further agrees that the amounts of the disgorgement and civil penalty shall be determined by the Court upon motion of the Securities and Exchange Commission ("Commission"), and that prejudgment interest shall be calculated pursuant to 28 D.S.C. § 1961 from March 5,2003. Edwards further agrees that in connection with the Commission's motion for disgorgement and/or civil penalties, and at any hearing held on such a motion: (a) Edwards will be precluded from arguing that he did not violate the federal securities laws as alleged in the Complaint; (b) Edwards may not challenge the validity of ths Consent or the Judgment; (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, and documentary evidence, without regard to the standards for summary judgment contained in Rule 56(c) of the Federal Rules of Civil Procedure. In connection with the Commission's motion for disgorgement and/or civil penalties, the parties may take discovery, including discovery from appropriate non-parties.
4. Edwards acknowledges having been fully advised and informed of his right to a judicial determination in this matter.
5. Edwards waives the entry of findings of fact and conclusions of law pursuant to Rule 52 of the Federal Rules of Civil Procedure.
6. Edwards waives the right, if any, to a jury trial, to seek relief from the Judgment under Rule 60(b) of the Federal Rules of Civil Procedure, and to appeal from the entry of the Judgment.
7. Edwards enters into this Consent voluntarily and represents that no threats, offers, promises, or inducements of any kind have been made by the Commission or any member, officer, employee, agent, or representative of the Commission to induce him to enter into this Consent.
8. Edwards agrees that this Consent shall be incorporated into the Judgment with the same force and effect as if fully set forth therein.
9. Edwards will not oppose the enforcement of the Judgment on the ground, if any exists, that it fails to comply with Rule 65(d) of the Federal Rules of Civil Procedure, and hereby waives any objection based thereon. Edwards understands that the Court may adjudge him in civil or criminal contempt if he violates any provision of the Judgment entered pursuant to this Consent.
10. Edwards waives service of the Judgment and agrees that entry of the Judgment by the Court and filing with the Clerk of the Court will constitute notice to Edwards of its terms and conditions. Edwards further agrees to provide counsel for the Commission, within thirty days after the Judgment is filed with the Clerk of the Court, with an affidavit or declaration stating that Edwards has received and read a copy of the Judgment.
11. Consistent with 17 C.F .R. § 202.5(f), this Consent resolves only the claims asserted against Edwards in this civil proceeding. Edwards acknowledges that no promise or representation has been made by the Commission or any member, officer, employee, agent, or representative of the Commission with regard to any criminal liability that may have arisen or may arise from the facts underlying this action or immunity from any such criminal liability. Edwards waives any claim of Double Jeopardy based upon the settement of ths proceeding, including the imposition of any remedy or civil penalty herein. Edwards further acknowledges that the Court's entry of a permanent injunction may have collateral consequences under federal or state law and the rules and regulations of self-regulatory organizations, licensing boards, and other regulatory organzations. Such collateral consequences include, but are not limited to, a statutory disqualification with respect to membership or paricipation in, or association with a member of, a self-regulatory organization. This statutory disqualification has consequences that are separate from any sanction imposed in an administrative proceeding. In addition, in any disciplinary proceeding before the Commission based on the entry of the injunction in ths action, Edwards understands that he shall not be permitted to contest the factual allegations of the Complaint in this action.
12. Edwards understands and agrees to comply with the Commission's policy "not to permit a defendant or respondent to consent to a judgment or order that imposes a sanction while denying the allegation in the complaint or order for proceedings." 17 C.F.R. § 202.5. In compliance with this policy, Edwards agrees: (i) not to take any action or to make or permit to be made any public statement denying, directly or indirectly, any allegation in the Complaint or creating the impression that the Complaint is without factual basis; and (ii) that upon the filing of this Consent, Edwards hereby withdraws any papers filed in this action to the extent that they deny any allegation in the Complaint. If Edwards breaches this agreement, the Commission may petition the Court to vacate the Judgment and restore this action to its active docket. Nothing in this paragraph affects Edwards' (i) testimonial obligations; or (ii) right to take legal or factual positions in litigation or other legal proceedings in which the Commission is not a party.
13. Edwards hereby waives any rights under the Equal Access to Justice Act, the Small Business Regulatory Enforcement Fairness Act of 1996, or any other provision of law to seek from the United States, or any agency, or any official of the United States acting in his or her official capacity, directly or indirectly, reimbursement of attorney's fees or other fees, expenses, or costs expended by Edwards to defend against this action. For these purposes, Edwards agrees that Edwards is not the prevailing party in this action since the parties have reached a good faith settlement.
14. In connection with ths action and any related judicial or administrative proceeding or investigation commenced by the Commission or to which the Commission is a party, Edwards (i) agrees to appear and be interviewed by Commission staff at such times and places as the staff requests upon reasonable notice; (ii) will accept service by mail or facsimile transmission of notices or subpoenas issued by the Commission for documents or testimony at depositions, hearings, or trials, or in connection with any related investigation by Commission staff; (iii) appoints Edwards' attorney, Irving Einhorn, 1710 10th Street, Manhattan Beach, CA 90266, as agent to receive service of such notices and subpoenas; (iv) with respect to such notices and subpoenas, waives the territorial limits on service contained in Rule 45 of the Federal Rules of Civil Procedure and any applicable local rules, provided that the party requesting the testimony reimburses Edwards' travel, lodging, and subsistence expenses at the then-prevailing U.S. Government per diem rates; and (v) consents to personal jurisdiction over Edwards in any United States District Court for purposes of enforcing any such subpoena.
15. Edwards agrees that the Commission may present the Judgment to the Court for signature and entry without further notice.
16. Edwards agrees that this Court shall retain jurisdiction over this matter for all purposes, including implementing and enforcing the terms of the Judgment and all other orders and decrees that have been and may be entered herein and granting such other relief as the Court may deem necessary and just.
17. Edwards represents that he has read and understands each provision of this Consent and the attached Judgment before signing the Consent.
