Practice Area: Litigation
Description: This lawsuit was instituted by the Plaintiff, Securities and Exchange Commission. The Plaintiff brought suit for monetary, injunctive and other equitable relief. Plaintiffâ€™s cause of action was stated as violations of Sections 20(d) and 22(a) of the Securities Act [15 U.S.C. Â§Â§77t(d) and 77v(a)] and Sections 21(d) and 27 of the Exchange Act [15 U.S.C. Â§Â§ 78u (d) and 78aa]. The Defendant James Bennett (Bennett) was the owner of Bearcat Financial Services (Bearcat). Defendant Bearcat was claimed to perform stock loan finding services. The Plaintiff alleged fraudulent conduct in the securities lending, or â€œstock loanâ€ business. Defendants Bearcat and Bennett maintained the Plaintiff failed to state a cause of action against Defendant. Defendant stated further that The Plaintiff merely pleaded conclusory allegations of law and bald assertions masquerading as facts and Plaintiffâ€™s assertions were unsupported by facts. Additionally, Plaintiff should have stated all facts on which his belief was formed. The Plaintiff had failed to plead sufficient facts to support the inference that Defendant Bennett acted with the requisite scienter and knowingly or recklessly engaged in the purported fraudulent scheme. The Defendant acted in good faith and did not directly or indirectly induce the act or acts constituting the purported violation(s) or cause(s) of action.