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Securities and Exchange Commission v. Sun Empire

May 26, 2009

SECURITIES AND EXCHANGE COMMISSION, PLAINTIFF,
v.
SUN EMPIRE, LLC, ECAM, LLC A/K/A EMPIRE CAPITAL ASSET MANAGEMENT, DELILAH A. PROCTOR, SHAUNTEL A. MCCOY, SUN INVESTMENT SAVINGS AND LOAN, SUN GROUP, BICH QUYEN NGUYEN, AND JOHNNY E. JOHNSON, DEFENDANTS, SUN COMMERCE AND INVESTMENT, INFINITY INVESTMENT CLUB, LLC, SUNLAND INVESTMENT CLUB, LLC, RECOMMENDED SERVICES, INC., AND TYCOON CLUB INTERNATIONAL, LLC, RELIEF DEFENDANTS.



The opinion of the court was delivered by: Honorable David O. Carter United States District Judge

PRELIMINARY INJUNCTION AGAINST SUN INVESTMENT SAVINGS AND LOAN, SUN GROUP, BICH QUYEN NGUYEN, AND JOHNNY E. JOHNSON, AND ORDERS:

(1) FREEZING ASSETS; (2) APPOINTING RICHARD WEISSMAN AS PERMANENT RECEIVER; (3) PROHIBITING THE DESTRUCTION OF DOCUMENTS; (4) GRANTING EXPEDITED DISCOVERY; AND (5) SETTING HEARING REGARDING APPLICATION FOR AN ORDER RE ANCILLARY RELIEF

This matter came before the Court upon Plaintiff Securities and Exchange Commission's Ex Parte Application for Temporary Restraining Order Against Sun Investment Savings and Loan, Sun Group, Bich Quyen Nguyen, and Johnny E. Johnson, and Orders: (1) Freezing Assets; (2) Appointing Richard Weissman as Temporary Receiver; (3) Prohibiting the Destruction of Documents; (4) Granting Expedited Discovery; (5) Requiring Accountings; (6) Repatriating Assets; and (7) Requiring the Surrender of Nguyen's and Johnson's Passports, and an Order to Show Cause re Preliminary Injunction and Appointment of a Permanent Receiver(the "Application"). On May 13, 2009, the Court granted the Securities and Exchange Commission's Application and ordered Sun Investment Savings and Loan ("SISL"), Sun Group, Bich Quyen Nguyen ("Nguyen") and Johnny E. Johnson ("Johnson") to show cause, if there be any, why a preliminary injunction should not be granted and a permanent receiver appointed in accordance with the Second Amended Complaint filed by the Securities and Exchange Commission ("Commission").

On May 26, 2009, the Commission, counsel for Nguyen and Johnson, and the temporary receiver over SISL and Sun Group filed a Stipulation Regarding Preliminary Injunction Against Sun Investment Savings and Loan, Sun Group, Bich Quyen Nguyen, and Johnny E. Johnson, and Orders:

(1) Freezing Assets; (2) Appointing Richard Weissman as Permanent Receiver; (3) Prohibiting the Destruction of Documents; (4) Granting Expedited Discovery; and (5) Setting Hearing Regarding Application for an Order Re Ancillary Relief ("May 26, 2009 Stipulation"). The Court, having considered the Second Amended Complaint, the Application, the supporting Memorandum of Points and Authorities, the First Interim Report by Receiver and Declaration of Richard Weissman, the Declaration of Molly White, the Declaration of Michael Lim, the Declaration of Dora Zaldivar, the Declaration of Joseph Ramirez, the Exhibits, and the May 26, 2009 Stipulation, finds that:

A. This Court has jurisdiction over the parties to, and the subject matter of, this action.

B. Good cause exists to believe that defendants SISL, Sun Group, Nguyen, and Johnson, and each of them, have engaged in, are engaging in, and are about to engage in transactions, acts, practices and courses of business that constitute violations of Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933 ("Securities Act"), 15 U.S.C. §§ 77e(a), 77e(c), & 77q(a), Sections 10(b) and 15(a) of the Securities Exchange Act of 1934 ("Exchange Act"), 15 U.S.C. §§ 78j(b) & 78o(a), and Rule 10b-5 thereunder, 17 C.F.R. § 240.10b-5.

C. The Commission has demonstrated a probability of success on the merits in this action and the possibility of dissipation of assets.

D. Good cause exists to believe that defendants SISL, Sun Group, Nguyen, and Johnson will continue to engage in such violations to the immediate and irreparable loss and damage to investors and to the general public unless they are restrained and enjoined.

I.

IT IS HEREBY ORDERED that the Commission's request for a Preliminary Injunction Against Sun Investment Savings and Loan, Sun Group, Bich Quyen Nguyen, and Johnny E. Johnson, and Orders: (1) Freezing Assets, (2) Appointing Richard Weissman as Permanent Receiver, (3) Prohibiting the Destruction of Documents, (4) Granting Expedited Discovery, (5) Requiring Accountings; (6) Repatriating Assets; and (7) Requiring the Surrender of Nguyen's and Johnson's Passportsis GRANTED as follows.

II.

IT IS FURTHER ORDERED that defendants SISL, Sun Group, Nguyen, and Johnson, and their officers, agents, servants, employees, attorneys, subsidiaries and affiliates, and those persons in active concert or participation with any of them who receive actual notice of this Order, by personal service or otherwise, and each of them, be and hereby are temporarily restrained and enjoined from, directly or indirectly, in the absence of any applicable exemption:

(a) Unless a registration statement is in effect as to a security, making use of any means or instruments of transportation or communication in interstate commerce or of the mails to sell such security through the use or medium of any prospectus or otherwise;

(b) Unless a registration statement is in effect as to a security, carrying or causing to be carried through the mails or in interstate commerce, by any means or instruments of transportation, any such security for the purpose of sale or for delivery after sale; or

(c) Making use of any means or instruments of transportation or communication in interstate commerce or of the mails to offer to sell or offer to buy through the use or medium of any prospectus or otherwise any security, unless a registration statement has been filed with the Commission as to such security, or while the registration statement is the subject of a refusal order or stop order or (prior to the effective date of the registration statement) any public proceeding or examination under Section 8 of the Securities Act, 15 U.S.C. § 77h. in violation of Section 5 of the Securities Act, 15 U.S.C. § 77e.

III.

IT IS FURTHER ORDERED that defendants SISL, Sun Group, Nguyen, and Johnson, and their officers, agents, servants, employees, attorneys, subsidiaries and affiliates, and those persons in active concert or participation with any of them, who receive actual notice of this Order, by personal service or otherwise, and each of them, be and hereby are temporarily restrained and enjoined from, directly or indirectly, in the offer or sale of any securities, by the use of any means or instruments of transportation or communication in interstate commerce or by the use of the mails:

A. employing any device, scheme or artifice to defraud;

B. obtaining money or property by means of any untrue statement of a material fact or any omission to state 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. engaging in any transaction, practice, or course of business which operates or would operate as a fraud or deceit upon the purchaser; in violation of Section 17(a) of ...


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