U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 19071 / February 9, 2005

Securities and Exchange Commission v. Rhino Ecosystems, Inc., et al., Case No. 02-80768-CIV-HURLEY/LYNCH (SD FL)

COURT GRANTS SUMMARY JUDGMENT AGAINST DEFENDANT GORDON NOVAK

On January 20, 2005, the Honorable Daniel T.K. Hurley of the United States District Court for the Southern District of Florida granted the Commission's motion for summary judgment against Defendant Gordon Novak. The Court found that Defendant Novak violated Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5, thereunder and aided and abetted violations of Section 13(a) of the Exchange Act and Rules 12b-20 and 13a-1, thereunder. In addition to injunctive relief, the judgment provides for the imposition of a civil penalty.

In its Complaint the Commission charged Defendant Novak and others with filing materially false and misleading statements and failing to disclose material information in filings with the Commission in violation of the federal securities laws. Although Novak defaulted in response to the Commission's motion, the court separately found that on the basis of the evidence submitted, the Commission was entitled to judgment as a matter of law.

For more information on earlier actions in this case, see Litigation Release No. 17685 (August 15, 2002).

http://www.sec.gov/litigation/litreleases/lr19071.htm