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SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case

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Posted by:   bobo 5/22/2006 8:51 AM

So, what is one to make of the bizarre letter from the SEC to the court in the Nanopierce case?

Why bizarre?

Well, for starters, in the world of courts and lawyers, one doesn’t send two-page letters instructing the court to ignore everything they have heard, and just get with the federal regulation program as interpreted by the federal body being implicated as remiss.

Further, it was addressed to the clerk of the court, and presented exactly zero support for its position – instead, it merely declared that the NASAA (and by extension the NCANS) brief was bad and wrong, and that the court should ignore the points articulated therein.

You know, just because.

There was no formal pleading.  No stabs at compliance with the rules.  No citation to legal authority, nor any attempt at supporting the SEC's position. Just a lot of words, hyperbole, ‘lil GW-style declarative proclamations, and not much else.

This is such a breach of legal protocol it is as though the new GC of the SEC walked into the court in a swimsuit and tossed his back-of-a-bar-tab response at the judge with a “pay attention, dumbass” flick of the wrist.

This is just plain weird. No attempt to observe decorum, no legalistic art or even competence – just a terse, rambling, “you can’t do that cause we say so” memo so ill crafted it has some of my attorney friends scratching their pates in confusion.

Read the letter.

And then wonder aloud at the arrogance and hubris required to imperiously instruct the court to ignore their sworn duty to treat the allegations of the plaintiff as legitimate…as it would jeopardize the SEC’s stranglehold on regulating the Wall Street boy’s club.

And we can’t have that.

Wild.

Here’s my hunch – the SEC has no idea how to respond to the briefs presented, so they don’t even try – they simply appeal to the court to ignore everything except their demands that they get with the program and start marching in step.

They can’t cite case law to support their declarations. They can’t offer examples. They can’t refute NASAA’s contentions, and they certainly can’t just say, “Do away with state regulators, state laws, and while we are at it, the concept of states!” They can’t even explain why, in a legal sense, the NASAA and NCANS briefs are wrong (because they aren’t). They can simply articulate how difficult having the DTCC held accountable via the state channels would be for them.

Golly. That’s a shame.

How ‘bout we get some discovery, and then the DTCC can PROVE that they aren’t regularly defrauding the nation?

How about that for an idea?

-------------------

According to the NY Sun today, the DOJ is getting involved in the OSTK tussle with Rocker and Gradient.

Apparently, if the accusations are true, the DOJ doesn't turn quite the blind eye to misbehavior that the SEC apparently has.

It will be interesting to see how this plays out, and view their perspective vis a vis the journalists who have been effectively excused from being investigated by Cox - he has pretty much stalled the subpoenas, and I see no evidence that they are going to be pursued any time soon.

Maybe the boys with cuffs can do something.

Sounds like we are going to find out.
Copyright ©2006 Bob O'Brien
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Comments (58)
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By teacheric on 5/22/2006 9:59 AM
So that's it? Is the court going to comply? I say screw 'em. I am so sick and tired of listening to how reg SHO is the cure for this crap. It reminds me of the false article in the Wall Street Journal last year about NFI, the one that all the bashers pointed to as if it were true information. Now, just because the SEC passed reg SHO, which has done absolutely nothing to solve the ftd problem, they quote what it says and states what it's supposed to be doing, but obviously it isn't working. If it were, we probably wouldn't be seeing so many court cases over naked shorting in the first place.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By teacheric on 5/22/2006 10:27 AM
You can't say let reg SHO fix the problem, and oh, by the way, if it needs to be adjusted, we'll make some minor adjustments. Meanwhile another year goes by, hundreds more companies go out of busiiness, thousands more small investors lose their shirts, Wall Street and the U.S. Treasury get richer. Enough is enough!
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By sick of freddo cazzo on 5/22/2006 3:29 PM
freddo, that's enough, the freddp cazzo thing is getting old.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By Jake Brodie on 5/22/2006 3:48 PM
incoherent. LOL. that's the perfect word for it. I mean you can pick up that they are arguing that they and they alone have jurisdiction over such matters. The vailed argument they seem to be making is the congress origianlly instituted the SEC to restore confidence in the markets and not necessarily fairness or equity. An investigation into the DTCC from outside the regime would most likely cause a crises of confidence which is precisely what the SEC sees as their mandate.

I suspect this is true, but if their inactions got us to this point then they themselves have violated their mandate to instill confidence. They are in violation of congressional mandate.

Oh and yeah, must be something in the water that leads people to believe that constitutional rights can be violated because some lawyer in the white house or the SEC thinks they have a good reason for doing so.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By InTheKnow on 5/22/2006 3:53 PM
Bullshit I say! Bullshit!

SETTLE THE TRADES or SETTLE IN JAIL!
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By hoagx on 5/22/2006 3:59 PM
Why can't we make a form letter and send it out to every Company on the SHO's list and let them know they are being Naked Shorted! Then direct them to this site. If we could get every Company on the Sho's list envoled, we would have a small army!
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By bobo on 5/22/2006 4:19 PM
Does anyone have Christopher Cox's email address? I really think that he should be our first "person of the week".
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By anon on 5/22/2006 4:35 PM
http://www.thepocketpart.org/2005/12/vail.html
See full article
The right to redress.
"Our government was born with the duty of providing redress to injured persons. Chief Justice Marshall said so in Marbury. We are not comfortable talking about duties of government. We talk about rights against government. But this is the social contract. Under contracts, one person’s right is another person’s duty. Whether you call it my right or the government’s duty, the Constitution requires the government to make my neighbor pay up. The right to redress is the consideration that supports the social contract."
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By Weakened Warrior on 5/22/2006 4:51 PM
You guys really are funny. You know so little, and say so much.

brokeflat has it exactly right. The SEC is simply saying that federal law pre-empts state law. The SEC is the arm that regulates -- promulgates rules under the law -- the financial markets (the same way that IRS promulgates rules without being a lawmaking body, as does the FAA, the FTC, and every other agency). You can't have every state attempting to put its nose in or you'll have chaos. The same is true, for instance, with the illegality of marijuana usage. States can vote to make it legal, but those laws will lose in court because federal law pre-empts.

All the SEC letter is saying, as brokeflat points out, is that the states cannot step in and challenge SEC rules. If as a plaintiff you want to try that out, go ahead -- but you have to do it in FEDERAL court.

Love the amateur lawyering though! Great fun to read!

WW
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By teacheric on 5/22/2006 5:18 PM
Wow, while looking for Cox's email address, take a look at what i found.
http://www.americanprogressaction.org/site/pp.asp?c=klLWJcP7H&b=736515

still looking for email
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By teacheric on 5/22/2006 5:23 PM
This is the only email i found so far that could be for chris cox:

chairmanoffice@sec.gov
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By Niel Storts on 5/22/2006 5:30 PM
"We hold these truths to be self evident" Well, it might be time. The great Thomas Jefferson warned everyone about this crud 200 years ago. We are about 10 revolutions out of synch. Committees of vigilance might be our only recourse.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By Majordanger on 5/22/2006 5:31 PM
My my I'm reading words like 'caliber', 'armories' and 'shoot em dead'
Easy kids ...it's only money.

I think this Nevada judge is breathing clean dry air from the lee side of the Sierra Nevadas and that will suerly dilute the BS stench from this galling SEC scare tactic.

I'm sure she has chuckled at many a "threatening " lawyer letter.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By hwh on 5/22/2006 6:00 PM
As with Dateline, less than a handful of names in DC wield enough clout to quash such proceedings.

Former CIA director Casey passing mysteriously days before testimony proved no one is untouchable.

How much longer will the U.S. be cojnsidered a Democracy,or at least a Democratic Republic..."by the people, opf the people, & for the people?"

We are a nation of laws; we just don't know who's...hwh
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By bobo on 5/22/2006 6:02 PM
Weakened Warrior:

The problem is that they fail to support their contention with anything more than hot air. No cases cited, nothing but bluster.

The fact is that Congress did not eliminate state rights to redress. That's why the state regulators are breaking from the SEC on this.

Let me guess, you know better than the state regulators too. In fact, everyone but the SEC is automatically wrong. Because the SEC couldn't possibly be promulgating rules which directly contradict Congressional mandates, and the DTCC couldn't possibly be participating in a massive fraud - I mean, what privately owned monopoly would abuse its power! That's preposterous.

I think we all understand your view. We have to agree to disagree.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By piddly_sum on 5/22/2006 6:09 PM
Six months ago, I sent an e-mail to both coxc@sec.gov and chairmanoffice@sec.gov. I cc'd the SEC Office of Inspector General using oig@sec.gov. Shortly thereafter I received a written letter back, so at least one of these addresses was correct at that time.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By Niel Storts on 5/22/2006 6:18 PM
The point is that if the duly appointed governmental agencies fail to exercise their responsiblity to act in the best interests of the people........... Then the people must take matters into their own hands. If the social contract is not fulfilled, and soon. That time is upon us. It's not that big of a deal. It's been done before.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By clearthinker on 5/22/2006 8:00 PM
if the SEC letter isn't obvious evidence of a coverup, then Watergate never happened...Does this country ever learn from history....follow the sales tickets (the money)....follow the fails....pressure, pressure, pressure...
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By Slipps on 5/22/2006 8:27 PM
Does the SEC and its rules trump the constitution? Unless there was an amendment passed recently I'm not following the state vs. federal argument. If there are constitutional issues here, then doesn't that trump both state and federal laws? Doesn't that trump the SEC?

If congress made free speech and the right to bare arms illegal, would states not have some legal action? If murder was made legal what actions if any could states take? I'm totally confused. I feel like I'm in the twilight zone. Like this isn't really all happening. I know there's the eminent domain thing, but the federal government can't just allow someone to take your property without some kind of fair compensation. Isn't that what naked shorting is? A dilution of your property which is a dilution of your specific piece of the aggregate wealth of a corporation. Isn't that what the famed economist Irving Fisher would say. Property and wealth coexist and a dilution of shares is thus a theft of wealth which is a theft of property. So can the federal government or federal agency or a quasi government body sanction the taking of your property (dilution is theft of wealth) without some form of compensation?
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By teacheric on 5/22/2006 9:09 PM
Can't we put some sort of ultimatum in the WA Post or something. "Settle the trades or get ready for a revolt; the time has come for the people to take back its country. Once again, we are a "sleeping giant." Let this latest court case be our Pearl Harbor.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By FREE RIDE on 5/23/2006 4:48 AM
Lets pick a day and everyone buy 1K OSTK share and never pay for it, lets ssee how long they will let us free ride.. Maybe we can use this in court and say until we get our share we dont have to pay.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By bbhindyou on 5/23/2006 5:36 AM
D.T.C.C. you have just naked shorted the american stock market for all it is worth! What are you going to do now? EURONEXT!!!!!!!!
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By Arnie Mass on 5/23/2006 6:10 AM
The suggestion to allow SHO to solve the Short fiasco is the equivalent of saying let Ray Naggin solve the mess in New Orleans with June 1st close at hand. Gd help New Orleans!
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By n-tres-ted on 5/23/2006 9:36 AM
The court may or may not see the letter. Ordinarily, if a party wants to file further argument, it files a motion for leave to file a responsive brief. This letter just tells the court the SEC is concerned about the arguments made by the NASAA, and then tries to turn those arguments against themselves.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By Wonder Boy on 5/23/2006 9:45 AM
The Supreme Court passed ruled that the Immenent Domain law could be used under most any circumstance to take property. Many states have passed laws nullifying the Supreme Court decision and many new laws are in the works. If the states can overrule the Supreme Court, why can't they overrule a crooked SEC?
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By bobo on 5/23/2006 10:42 AM
This is really pretty simple, at its core. If the regulator is remiss in doing its job to prevent fraud, do the states have the power to hold the fraudster accountable at that level, or is their power abdicated? Further, if a regulator passes rules which are in conflict with the law, and enables an SRO to be in conflict with the law, does that absolve the SRO of the responsibility of complying with the law?

Nowhere have I seen a case cited that showed where a regulator's rules could contradict the laws passed by congress. Or that regulators could simply declare the states powerless, without citing any precedent.

And yet here we have exactly that, with the logic being that all hell would break loose if the DTCC were held accountable in state court.

Did I miss where they are NOT a private company doing business in those states, and thus subject to state law in those states?

This is preposterous gibberish from the SEC, and I suspect they know it.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By oldfeller on 5/23/2006 3:31 PM
Well I feel better now. I received materials today in the mail from proxy services allowing me to vote my OSTK shares at the 4/25/06 meeting.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By phonesll on 5/23/2006 5:02 PM
I would say the SEC is saying to the state court that they have no business meddling in SEC regulatory business. You may be right in that they couldn't come up with an adequate response based on case law and that would be because there is plenty of case law supporting the states rights to deal with all kinds of securities issues. This doesn't surprise me though based on the way they've dealt with the rest of the illegal activities.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By Wonder Boy on 5/23/2006 6:33 PM
Suppose Nevada hears the case and it is found that the DTCC IS crooked. What does this then do to the SEC? Further, what would people then think of Congress who is supposed to be overseeing this den of thieves?
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By FreddoCazzo on 5/24/2006 12:15 AM
.............and I still havent received any response from either NPR, TheNation.com, or the Honorble Yang. Go figure.......pissin me off....i mean what in the world do we have to do? Does someone have to spill some blood around here or what???


PORCO CANE!!! Stop this NEFARIOUS CHIT!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!


............still freddo.............even more cazzo!
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By Niel Storts on 5/24/2006 7:45 AM
There are many cases going forward, finally. Personally, I maintain that IF the courts don't stand up and do their jobs re: gradient, rocker, cohen et al... and that does NOT constitute slapping them on the wrist.....Time for some individuals to take the law in their own hands. Lynch the bastards. Just my humble opinion. Have a nice life.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By brokeflat on 5/24/2006 9:20 AM
Strange ... and not what one would hope for in an 'honest' discussion.

I posted a convoluted and tortured logic supporting the SEC position -- a post made with tongue firmly in cheek -- to which Weakened Warrior replied -- with a follow up by Bobo -- and, lordy! My post has be expunged from the record. Redacted so to speak. The remnants are there (Weakened Warrior's reference to 'brokeflat') but not the original post. Why oh why would a post be deleted; a post that in content was whole hearted support of the idiocy and illogic and circular reasoning evident in the SEC position?
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By bobo on 5/24/2006 9:54 AM
brokeflat:

The posts are appearing out of order, because of a bug in the blog sw. Your "expunged" post appears about two after this one appears. Nothing nefarious, just a software issue that the developers STILL haven't fixed.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By brokeflat on 5/24/2006 12:39 PM
So much for posting a sarcastic comment; both Weakened Warrior and tbs_theman missed the convoluted reasoning and my attempt to make the absurd even more so. C'mon fellas (gals?). How absurd does one have to get? [Note to self; must try harder!]

However, has it occurred to anyone that the feds may have already exercised some off-the-record heavy leaning on this judge? If so, then this letter could simply be post-facto agreement to 'back off'. The letter becomes published justification for the judge to dismiss and or bar discovery in the case. It's obvious that the filed briefs wouldn't suffice for such. Not without some excruciating and convoluted reasoning on the part of the judge. No; he might have said he needed something else, like this letter, to point at and say--'end of discussion'.

I'm not saying any such thing has happened, or that the judge can be so pressured, but we have seen stranger (not so strange?) things happen during our long wait for action, have we not? [Hear that, judge? Not saying you have been leaned on and have made a deal; just saying that, in the course of human history, such as occurred in the past and as such it 'could' again have happened in this instance. OK? Can I still enter NV without fear of being thrown in the clink for contempt of court? Please?]
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By hemingway811 on 5/22/2006 10:35 AM
This is what they are really afraid of:

<<...if the Nevada courts agree with the Commission's judgment, a new set of plaintiffs in a different state may bring the exact same allegations and repeat the process, presumably until cases have been brought in all fifty states, with a win in even one state causing the UNDESIRABLE CONSEQUENCES we have enumerated on a nationwide basis.>>
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By brokeflat on 5/22/2006 10:38 AM
Bunny; I don't view their reply as specious--it's to the point. Their point is simply that although congress makes the law, the SEC makes the rules, and the rules so made are not being violated. Furthermore, only the SEC due to its regulatory charter can evaluate whether or not a SRO is obeying rules the SEC has promulgated to regulate such SRO. And, as the clincher, if the court allows itself to be interposed between the regulator and the regulated that it would result in chaos in the financial markets and that positions seems quite reasonable to me (the market being in the mess it is now). Seems a perfectly clear and reasonable position (for them to take).
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By John on 5/22/2006 10:41 AM
I'm really starting to get sick and tired of all this BS. I can't believe this is allowed to go on and on like this. Settle the trades. Why is that so hard? Why are so many companies persistantly on the reg sho list. We can send a man to the moon, but we can't settle trades. This is just wonderful. I'm really starting to get angry. I think we need to form a more militant wing of NCANS. I have the right to defend myself against theft and if the police and authorities won't come to my aid then I have the right to use force to protect my property.

John Q
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By mhatmccane on 5/22/2006 10:49 AM
According to a blog by Bud Burrell, the Supreme Court (the US one) has a ruling that would negate reg SHO. This from the blog:

Re: Hartman v. Moore, Supreme Court Ruling of Significance By bburrell on 5/3/2006 7:43 AM
mhatmccane:

There is no enabling legislation giving the SEC any authority to "grandfather" prior law-breaking. They are "assuming" the authority, completely outside of the enabling legislation that created them.

Sean:

The DTCC settled one case early on when the plaintiff brought up counterfeiting, in a sealed settlement. There are about 4 cases I am aware of involving DTCC having current exposures. Recently, DTCC's counsel has threatened potential plaintiff lawyers with Rule 11 sanctions if they go after them. That has scared off several new actions.

Two actions are pending against the SEC and DTCC, and both are preceding WITH DISCOVERY HAVING BEEN GRANTED AND PRODUCED IN THE FIRST ONE. I have some knowledge of what has been found thus far, and it is a nightmare for the SEC.

DTCC has been "granted" limited immunity by the SEC. The SEC has no legal basis for granting such immunity to anyone. This limited immunity granted them does not extend to matters in which the DTCC (or the SEC) have any pecuniary interest.

I will tell you a story about many of the most famous plaintiff's actions of the last half century. They all got nowhere until they had gotten kicked in the face fifty or more times over ten to 20 years. Only persistence and the correctness of their causes eventually won out. That is what I think will happen here. There has been so much perjury here by the agencies involved, they are now jumping ship like the rats they are.

Fraud on this scale in time of War is not just fraud, it is treason. DTCC is a monopoly/cartel, owned by a syndicate which works together in violation of existing laws. This will come out. I know some of those who will plead their cases for these causes.

The Limited Immunity of these agences does NOT extend to violation of the Bill of Rights, or of any other element of the Constitution. These claims also avoid PSLRA, and they have sat Federal Judges back in their chairs when properly articulated. I feel some frustration over this, having advised counsel for some of he victims repeatedly that there were real constitutional claims that needed to be made here, with the support of a senior SEC lawyer firm, and that has only happened when one Company pled its cause Pro Se, and another had a senior Federal prosecutor for counsel. Both are getting discovery, when no one else has.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By tbs_theman on 5/22/2006 10:57 AM
brokeflat

Your reading is incorrect. What is in front of the judge is a case to be decided BY LAW. What the SEC said is that they have "rules" and their "rules" supercede LAW. That's just ridiculous. The NASAA brief was about properly applying the LAW to the case. And, it points out, that you can't just make a government agency cannot just make a "rule" to supercede he LAW.

If recall years ago, the IRS tried to make a "rule" that disallowed many people to be self-employed. Essentially the same argument. "Well, geez, if we let people be self-employed, people will actually take deductions allowed to them by law". A judge overturned their "rule", because the self-employeed individuals did everything required of them BY LAW.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By CMElec on 5/22/2006 11:10 AM
The SEC has put itself in front of the criminals as a defendant. Henceforth all should be able to see that they are clearly responsible for breaking the law. Congress has studied and found that FEMA is ineffective and it should be dissolved. So also should the SEC, as they are lawbreakers in direct opposition to rules Congress has instituted.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By CMElec on 5/22/2006 11:19 AM
OSTK has an attorney who can kick big butt. The SEC is feeling the heat and knows their larceny up till now may break the system.... let it break. If it cleans house and initiates reform it could only be good.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By hipppity on 5/22/2006 1:17 PM
Don't post copywritten material here. I have been getting some flack, and will censor any such posts. Thanks for your time.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By rtway1 on 5/22/2006 12:08 PM
This is further proof that we are drifting to a third world country status when our federal government tries to exert its influence over the individual states just because they said so. Can you say Soviet Union. And look what happened with that social miscarriage. Cox and company, should be driven out of office before they see a revolution instead of their imbalances in the market. That letter from the SEC would have been fuel for a revolution if our founding fathers were served. My level of trust in our financial and judicial system diminishes every day, and I am sure other countries are looking closely at this also.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By rtway1 on 5/22/2006 12:18 PM
What has my shorts bunched up so much is that not one of these so-called committees has never directed just one simple question to Mr. Cox. Why not make the DTCC transparent, even on a semi annual basis, so that we the investor have proof, and therefore get rid of all the speculations. Can we have at least one person that represents the public instead of a politician that has ties to lobbyist sit on these panels and ask questions that we the investor want answered.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By anon on 5/22/2006 12:26 PM
Seems like a revolution is the only thing that will get us the proper media coverage we deserve. If we don't stand up for ourselves, no one else will.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By Niel Storts on 5/22/2006 12:50 PM
I must say that I am currently feeling a pang of shame. Odd how it came about but first I will state that I am a relation to the last person in this country who recieved a pension for being a surviving (daughter in this case) of a vetern of the revolutionary war. My shame is that my ansecters were blind enough to not tell georgie washington to go take a flying leap when he was striving to enlist aid in the quest to establish a new nation on this Earth. This is disgusting.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By Dennis on 5/22/2006 12:55 PM
I'm for revolution. The founding fathers would expect no less from all good Americans.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By Jeremiah 9:24 on 5/22/2006 1:14 PM
OK, this letter is laughable. BobO, I assume that someone from NCANS and/or NASAA will write a response to this silliness? Hopefully our side will be a bit more respectful of the Court, and will not insult the judges' intelligence as this SEC lawyer has done.

The Commission claims that "evaluating these claims of alleged defects has been entrusted by Congress to the Commission, not to the state courts." On what basis is this claim made? Where's your legal authority for this claim, guy? Why, none is given--we are the SEC, dammit, it is because we say it is! We don't care that the other side has shown that it was specifically Congress' intent to let the States also regulate clearing and settlement matters. Just ignore that, judges, because we are the SEC. The feds.

These SEC guys must think they are writing for a New York or Maryland court. Let's see how that kind of stuff plays in Nevada.

You know, it appears from the first paragraph of page two of this letter that the SEC is arguing that it would be better for the Nevada court to disagree with "the Commission's exercise of its expert judgment." What the hell are they trying to say here? "Hey, if you disagree with us and let these claims go to discovery, and IF after discovery the defendants are not able to get the case dismissed on summary judgment due to lack of evidence, then IF a jury determines that the defendants did in fact do something wrong [the SEC dares not call it fraud], then IF the judge doesn't overrule the jury's decision, and then IF the judgment is upheld on appeal, then "they could be forced...into changing the way they do business...."

So, the SEC is complaining that if it is determined in a court of law after all appeals are exhausted that the industry owned DTCC scum committed fraud, then the DTCC may have to change its ways and stop committing fraud...even though we at the SEC don't want any changes, whether or not the DTCC is committing fraud. And they are not because we say so. And no, we won't give anyone any proof. Simply unbelievable. But at least the SEC's letter is incoherent.

It is not worth the trouble to tear this thing apart. Everyone who reads it can see it is a desperate move. Why are they so desperate, though, to protect the DTCC? I guess it is a good sign when they realize they have nothing left, but have to try something anyway. Hey SEC, maybe the Nevada Supreme Court doesn't care about Nevada investors or companies any more than you do, in which case you and your industry friends will be OK.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By revolting on 5/22/2006 1:18 PM
What about putting up a survey of some kind, a poll, to see who is willing to revolt (pickett) or whatever it takes. If there are enough takers, perhaps something could get organized.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By bobo on 5/22/2006 1:23 PM
Jeremiah:

I'm not going to respond to the letter. I'm not an attorney. However, those I've discussed this with are sort of shocked - they've never seen anything quite like it. No citations to establish the basis of their claims, nothing but baseless assertions as to what they believe Congress wanted - even though that flies in the face of the established cases introduced in the NASAA and NCANS briefs. Their position is essentially: 1) We are the SEC, and as such, know better than you, the court, or the state regulators. 2) You will take our assertions at face value, completely absent any support - see item 1 for why. 3) You can't let the states do their jobs and ascertain whether the DTCC is in fact operating in a fraudulent manner, as alleged, as if you did, everyone would come after them, and chaos would ensue.

All of this ignores that recourse via the state courts in a fraud case is allowed by Congress, and that the only reason the DTCC or the SEC would have anything to fear is that they were in fact involved in something the state courts would find fraudulent.

The fear in the letter is palpable: "You can't let them see the books - you just can't!"
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By upwardmo on 5/22/2006 1:31 PM
Let's face it, revolution isn't in the card right now. Our best bet is probably to:

a) continue the fight on legal grounds, with lawsuit after lawsuit until eventually (a la big tobacco) one of the suits prevails

b) pool our resources (which are considerable, given how many are suffering from and now aware of the criminal situation in our markets) and put out more ads like the previous one (in the Washington Post?) that bring more attention to the matter and the complicity therein of our politicians and bureaucrats.

Fear of public exposure and embarrassment may yet break the gridlock in Washington that's preventing anything from being done to rectify this broken market.

I also think class action shareholder lawsuits could be brought on the basis of voting irregularities, which are well documented in numerous stocks. This seems to me a clear-cut Achilles heel in the system--and dicsovery could open the gates to many other types of lawsuits. We can't sit around and wait for management of the targeted companies to file the suits; we the shareholders are going to have to organize and do it ourselves.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By Majordanger on 5/22/2006 1:33 PM
The Gall !
It's apparent the SEC is now RUNNING to the curbside trashbin with this leaking plastic trashbag of wet kitchen garbage before it explodes on thier front step.
Keep poking holes Bobo.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By rtway1 on 5/22/2006 1:43 PM
If ever there was a time for the ACLU to make points with the American public it would be now. I AM NOT a fan of the ACLU, with that said I feel that they can get instant media coverage just by their mere presence in a room. With this power of getting the media attention and the luxury of a budget that is funded by the government who is screwing us, I think this a powerful weapon especially if they want to expose the big monopolies who have screwed the public with the assistance of the federal government by violating the rights of everyone. I think if the case were to be presented to the public in a language they understood (pensions, IRA,s etc.) the public would probably donate to the ACLU. If the ACLU took this on, this would be back on 20/20 and O,Reilly Factor in a wink.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By Jeremiah 9:24 on 5/22/2006 1:50 PM
Can't let this one go by (3rd to last sentence in the SEC's letter): "Preemption cannot be evaded by invoking the presumption that allegations in a complaint are true for purposes of ruling on a motion to dismiss."

Basically, NCANS and NASAA showed--using the law--that preemption is NOT appropriate here, in part since both state and federal lawmakers can regulate matters at the same time (e.g., securities laws), and Congress did not say "states must back off clearing and settlement regulation and leave it to the feds" or even imply this in any way in Congress' rulemaking on the issue; in fact, as NASAA pointed out, Congress seems to invite states' additional protective measures.

And the SEC does not even argue the point other than to state without legal backing that Congress "entrusted" such claims as the plaintiff makes "to the Commission [we assume they mean exclusively to the Commission, but of course they have no evidence to support this], not the state courts."

Read NASAA's brief and you will see that the SEC is not here making a true statement to the Court. And the SEC can't offer any legal proof otherwise; they don't seem to even be trying to. All they can offer is warnings of grave threats of irreparable harm to their (emphasize THEIR) "regulatory system." I say, Amen, let there be irreparable harm to their failed system--it's robbing the American public blind, so let it collapse, as it and all other corrupt systems inevitably will anyway, and let's start over.

My recollection from Civil Procedure class is that the presumption the SEC objects to is to be made by the Court unless there is a clear and convincing proof given that the allegations are in fact NOT true. That is, unless the DTCC scum and/or the SEC can convince the Court that the allegations made by the victim company (the plaintiff here) are absolutely NOT true (and "because we say so" is not enough) then the Court has to use the presumption that they ARE true.

So, unless the SEC and DTCC can offer some strong proof, and strong denials alone don't count, the Court should be required by the rules to make the presumption that the SEC so fears. I believe it is the truth--and its consequenses for the industry--that the SEC really fears.

Will the Court uphold the law?
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By anonnie on 5/22/2006 2:03 PM
I have a friend who's spouse is an SEC lawyer and off the record says the letter to NV is bullshit.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By revolting on 5/22/2006 2:10 PM
How is our best bet to continue what we've been doing? I like continuing to lose in my retirement account. I like getting robbed and then laughed at by the crooks on Wall Street. I like them thinking I am just an idiot who they can steal from anytime they wish. If anything, our resources are getting smaller, not bigger. The only thing that is getting bigger is the number of people being robbed. Just think of the billions it's going to cost as we continue to wait for our day in court, if it ever comes. We need immediate recourse. This crap has been going on way too long. I think we've been patient enough to try and solve these illegal tactics in a legal manner. Time to dump the tea in the harbor and piss on it.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By Wonder Boy on 5/22/2006 3:05 PM
Well, the SEC lawyer is certainly pompous and arrogant in the support of the 'federal regulatory regime'. Was the letter intimidating enough for the NV judge? Sounds to me like the SEC has a LOT to fear from the states. If in their almightyness, they had passed laws that worked and enforced them, maybe they wouldn't be playing this sort of a high handed game now.

The SEC has had the opportunity to settle the trades, report the fails to deliver, and offer the small investor a much more level playing field. The SHO regulation has been in effect for almost 1 1/2 YEARS and it is NOT WORKING.

We had one civil war over state's rights. I am not an advocate of another one, but.................. A better start would be to get rid of most every politician in Congress and replace them with folks with common sense. Perhaps there would be a lot less harping and a lot more constructive action.
Re: SEC issues bizarre letter to NV court, DOJ getting involved in OSTK case By Freddo Cazzo on 5/22/2006 3:25 PM
...................ahahahahah .....he said ...."piss on it!"


Amen to that! What are we waiting for?

Why would Cartwright even put his name on that letter is beyond me. I hope he, and everyone else who seems to be trying thier best to hide all of this corruption go straight to prison, or better yet, the gallows. This is a prime example of why public hangings need to be brought out of the dirty ole closet!

Can we find Cartwrights email and pound it full of emails? Can we email the court of nevada?

I just dont know what else to do. I have written my official, and received thier canned, tiresome responses. I havent received a reply from either NPR, or The Nation.....go figure.


I am suprised that people haven't been shot yet. Point blank, Desert Eagle .50 cal style!

Push comes to shove, we can make our forefathers proud. I know enough people with personal armories. What about ya'll? (yeah i said ya'll! I'm in the new wild west, Florida. What do you expect? )

.......btw did you know they just passed a law here that states if you are a victim of road rage, and the person gets out of thier car, and comes towards you in an offensive manner, and you fear harm is coming to your well being, you are allowed to pull your gun out, and shoot him/her dead in the street??? These SEC and DTCC regulators better be happy they dont live down here is all I have to say!)


.................still Freddo...............even more Cazzo!

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