Below is the 13 page motion of defendant's Universal Express, INC., Richard Altomare and Chris Gunderson for partial summary judgment of dismissal and supporting memorandum of law.
Below that is the 11 page Declaration from Chris Gunderson.
For media and other inquiries that would like PDF versions of all 17 major posts via email please send request to usxpshareholders(at)gmail(com).
BARRY SCHAEVITZ, ESQ (BS-3405)
JACOB MEDINGER & FINNEGAN, LLP
Local Counsel for Defendants Universal
Express, Inc., Richard A. Altomare and
Chris G. Gunderson
1270 Avenue of the Americas, 31st Floor
New York, NY 10020
(212) 332-7773 (telephone)
(212) 332-7239 (facsimile)
and
ARTHUR W. TIFFORD, ESQ.
TIFFORD AND TIFFORD, P.A.
Lead Counsel for Defendants Universal
Express, Inc., Richard A. Altomare and
Chris G. Gunderson
1385 N.W. 15th Street
Miami, FL 33125
(305) 545-7822 (telephone)
(305) 325-1825 (facsimile)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
CASE NO. 04-CV-02322-GEL
U.S. SECURITIES AND EXCHANGE COMMISSION,
Plaintiff,
v.
UNIVERSAL EXPRESS, INC., etc., et al.,
Defendants.
_______________________________________________/
MOTION OF DEFENDANTS UNIVERSAL EXPRESS, INC.,
RICHARD A. ALTOMARE AND CHRIS G. GUNDERSON
FOR PARTIAL SUMMARY JUDGMENT OF DISMISSAL AND
SUPPORTING MEMORANDUM OF LAW
(ELECTRONICALLY FILED)
1
Defendants Universal Express, Inc. (“Universal” or “USXP”),
Richard A. Altomare (“Altomare”) and Chris G. Gunderson
(“Gunderson”), by their undersigned attorneys and pursuant to
Rule 56, Federal Rules of Civil Procedure, respectfully move for
the entry of an order in the above styled civil action awarding
them a partial summary judgment of dismissal. As demonstrated in
the following memorandum of law, there exist no genuine issues
of material fact and, as a matter of law, Universal, Altomare
and Gunderson are entitled to the dismissal of the Complaint’s
First Claim For Relief, which alleges violations of §§ 5(a) and
5(c) of the Securities Act of 1933, 15 U.S.C. §§ 77e(a)1 and
1
Section 5(a) of the Securities Act of 1933, 15 U.S.C. §
77e(a), is entitled “Sale or delivery after sale of unregistered
securities” and provides:
Unless a registration statement is in effect as to a
security, it shall be unlawful for any person,
directly or indirectly-
(1) to make 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; or
(2) to carry or cause 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.
2
77e(c).2
MEMORANDUM OF LAW
I THE FACTUAL SETTING; STATEMENT OF UNDISPUTED FACTS.
As their statement of undisputed facts the movants
incorporate by reference the factual setting below, the facts
set forth in the below memorandum of law and the declaration of
Chris G. Gunderson and its exhibits.
Universal was organized in the State of Delaware on January
16, 1986. It merged into Packaging Plus Services, Inc. (“PPS”),
a Nevada corporation, pursuant to a merger agreement entered
into on April 2, 1986, and filed in the State of Nevada on June
2, 1986. The Nevada corporation, which survived the merger and
changed its domicile to the State of Delaware, was a dormant
2
Section 5(c) of the Securities Act of 1933, 15 U.S.C. §
77e(c), is entitled “Necessity of filing registration statement”
and provides:
It shall be unlawful for any person, directly or
indirectly, to make 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 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 77h of this title.
3
public company organized on April 8, 1983, by Mr. Jerry
Beagelman as Silver-Gold Reclamation, Ltd.
On December 19, 1991, PPS filed for reorganization under
Chapter 11, Bankruptcy Code, in the U.S. Bankruptcy Court,
Eastern District of New York (“the Bankruptcy Court”). In re:
Packaging Plus Services, Inc., Debtor, Case No. 191-18486-260
(Hon. Conrad B. Duberstein, U.S. Bankruptcy Judge). Thereafter,
pursuant to an order of the Bankruptcy Court, Mr. Beagelman and
members of his family were removed from all offices and
directorships of PPS and Altomare was installed as its President
and Chief Executive Officer, which positions he continues to
hold.
The Bankruptcy Court, on February 18, 1994, in Case No.
191-18486-260, confirmed PPS’s Plan of Reorganization (“the
Chapter 11 Plan”). Thereafter PPS changed its name to Universal
Express, Inc., and Gunderson was appointed as its General
Counsel, which position he has held to this date.
II THE STATUTORY FRAMEWORK
Section 1123, Bankruptcy Code, 11 U.S.C. §1123, provides in
pertinent part:
(a) Notwithstanding any otherwise applicable non-
bankruptcy law, a plan shall
* **
4
(5) provide adequate means for the plan’s implementation
such as
* **
(j) issuance of securities of the debtor…for cash, for
property, for existing securities, or in exchange for
claims or interests, or for
any other appropriate purpose;…(emphasis added)
Section 1125, Bankruptcy Code, 11 U.S.C. § 1125, is
entitled “Post petition disclosure and solicitation” and in
pertinent part provides:
(e) A person that solicits acceptance or rejection of
a plan, in good faith and in compliance with the
applicable provisions of this title, or that
participates, in good faith and in compliance with the
applicable provisions of this title, in the offer,
issuance, sale, or purchase of a security, offered or
sold under the plan, of the debtor, of an affiliate
participating in a joint plan with the debtor, or of a
newly organized successor to the debtor under the
plan, is not liable, on account of such solicitation
or participation, for violation of any applicable law,
rule, or regulation governing solicitation of
acceptance or rejection of a plan or the offer,
issuance, sale, or purchase of securities.
Section 1145, Bankruptcy Code, 11 U.S.C. § 1145, is
entitled “Exemption from Securities Laws” and in pertinent part
provides:
(a) Except with respect to an entity that is an
underwriter as defined in subsection (b) of this
section, section 5 of the Securities Act of 1933 and
any State or local law requiring registration for
offer or sale of a security or registration or
licensing of an issuer of, underwriter of, or broker
5
or dealer in, a security do not apply to-
(1) the offer or sale under a plan of a
security of the debtor, of an affiliate
participating in a joint plan with the
debtor, or of a successor to the debtor
under the plan-(
A) in exchange for a claim
against, an interest in, or a
claim for an administrative
expense in the case concerning,
the debtor or such affiliate; or
(B) principally in such exchange
and partly for cash or property;
(2) the offer of a security through any
warrant, option, right to subscribe, or
conversion privilege that was sold in the
manner specified in paragraph (1) of this
subsection, or the sale of a security upon
the exercise of such a warrant, option,
right, or privilege;
(3) the offer or sale, other than under a
plan, of a security of an issuer other than
the debtor or an affiliate, if-(
A) such security was owned by
the debtor on the date of the
filing of the petition;
(B) the issuer of such security
is-(
I) required to file
reports under section 13
or 15(d) of the
Securities Exchange Act
of 1934; and
(ii) in compliance with
the disclosure and
6
reporting provision of
such applicable section;
and
(C) such offer or sale is of
securities that do not exceed-(
I) during the two-year
period immediately
following the date of
the filing of the
petition, four percent
of the securities of
such class outstanding
on such date; and
(ii) during any 180-day
period following such
two-year period, one
percent of the
securities outstanding
at the beginning of such
180-day period; or
(4) a transaction by a stockbroker in a
security that is executed after a
transaction of a kind specified in paragraph
(1) or (2) of this subsection in such
security and before the expiration of 40
days after the first date on which such
security was bona fide offered to the public
by the issuer or by or through an
underwriter, if such stockbroker provides,
at the time of or before such transaction by
such stockbroker, a disclosure statement
approved under section 1125 of this title,
and, if the court orders, information
supplementing such disclosure statement.
III THE PLAN’S EXHIBIT “I”
Exhibit “I” to the Chapter 11 Plan was a document entitled
“1994 Stock Option Plan”, also regularly referred to by
7
Universal as the “Stock Incentive Plan”, which in pertinent part
provided:
This Plan shall be known as the “1994 Stock Option
Plan”, (the “Plan”). The purpose of this Plan is to
provide a method to give incentive to those persons or
entities who, in the sole and absolute discretion of
the Board of Directors of Packaging Plus Services,
Inc., a Delaware corporation (“the Company”), are
responsible for the management, growth, and/or
protection of the Company’s business and who are
making and can continue to make substantial
contributions to the success of the Company’s business
including, but not limited to, present and future
officers, directors, employees, consultants,
franchisees and professional advisors of the Company
or any future Parent or Subsidiary.
It is anticipated that the Plan will encourage them to
acquire capital stock ownership in the Company, thus
giving them a, or increasing their, proprietary
interest in the Company, providing them with greater
incentive and encouraging their continuance in the
service, and promoting the interests, of the Company
and all of its stockholders...
*********
The shares to be issued upon exercise of options which
are granted pursuant to this Plan shall be made
available, at the discretion of the Board of
Directors, either from the authorized but unissued
shares of Common Stock or from shares of Common Stock
which are reacquired by the Company, including shares
which are purchased in the open market.
There will be reserved for use upon the exercise of
options which may be granted pursuant to this Plan an
aggregate of 1,250,000 shares of Common Stock.
*********
However,
8
If the number of outstanding shares of Common Stock of
the Company shall be changed by reason of any
recapitalization, stock split, or stock dividend, the
aggregate number and kind of shares for which options
may thereafter be granted under this Plan and the
number of shares subject to options theretofore
granted under and the price per share payable upon
exercise of such options shall be adjusted as
determined by the Plan Administrators, in their sole
and absolute discretion, so as to reflect such change;
provided, however, that no such adjustment shall be
made by reason of the issuance of additional shares of
the Company for services, property or money regardless
of whether the Company received adequate
consideration.
*********
And,
Unless sooner terminated, this Plan shall terminate on
the tenth (10th) anniversary date of the earlier of the
date upon which this Plan is adopted or the date upon
which this Plan is approved by the stockholders of the
Company; provided, however, that all options which are
granted under this plan shall continue in full force
and effect until terminated in accordance with the
terms and conditions of the options and this Plan.
This Plan will be submitted to the stockholders of the
Company for approval by the holders of a majority of
the outstanding shares of Common Stock of the Company.
IV THE CONFIRMED CHAPTER 11 PLAN
Paragraph VI.F of the confirmed Chapter 11 Plan provided:
The protection afforded by Bankruptcy Code section
1125 with regard to the solicitation of acceptances or
rejections of the Plan and with regard to the offer,
issuance, sale, or purchase of the Post petition
Senior Secured Notes and the New Common Stock and New
Warrants issued and distributed to the holders of
Claims and Administrative Claims or in connection with
the Plan and the Confirmation Order, shall apply to
9
the full extent provided by law. The entry of the
Confirmation Order shall constitute the determination
by the Bankruptcy Court that Reorganized PPS, PPS, and
each of their respective officers, directors,
partners, employees, members or agents, and each
Professional Person, attorney, accountant, or other
professional employed by any of them, shall have acted
in good faith and in compliance with the applicable
provisions of the Bankruptcy Code pursuant to
Bankruptcy Code section 1125 and the federal
securities laws. In addition, the exemption from the
requirements of section 5 of the Securities Act and
any state or local law requiring registration for the
offer or sale of a security provided for in Bankruptcy
Code section 1145 shall apply to the New Common Stock,
the New Warrants, and the Warrants Shares to be issued
under the Plan in exchange for any Claim against or
interest in PPS. Entry of the Confirmation Order
shall also constitute an order of the Bankruptcy Court
that the Debtor has, by virtue of its public filings,
complied with the reporting requirements of the
Securities Act of 1934 through the Effective Date.
Upon Confirmation, however, as a publicly held
corporation the Debtor remains subject to Securities
and Exchange Commission reporting requirements and
subsequent to Confirmation of the Plan and the
Reorganized PPS intends to comply with all periodic
reporting requirements including Section 12(g) of the
Securities Exchange Act of 1934.
V THE GUNDERSON DECLARATION
The Gunderson Declaration, the contents of which are
incorporated herein by reference (“the Gunderson declaration”).
The Gunderson declaration establishes that the shares of
Universal’s common stock referred to in the Complaint in this
civil action were issued in accordance with and pursuant to
Exhibit “I” of the confirmed Chapter 11 Plan.
10
VI ARGUMENT
Because the shares of Universal’s common stock referred to
in the Complaint in this civil action were issued in accordance
with and pursuant to Exhibit “I” of the confirmed Chapter 11
Plan, under §§ 1125(e) and 1145(a) of the Bankruptcy Code,
supra, they were exempt from the registration requirements of §§
5(a) and 5(c) of the Securities Act of 1933, 15 U.S.C. §§ 77e(a)
and 77e(c), supra. Consequently, Universal, Altomare and
Gunderson are entitled to a partial summary judgment dismissing
the Complaint’s First Claim For Relief.
VII CONCLUSION
The motion of Universal, Altomare and Gunderson for partial
summary judgment of dismissal should be granted and the First
Claim For Relief should be dismissed.
Respectfully submitted,
TIFFORD & TIFFORD, P.A.
Lead counsel for Universal,
Altomare and Gunderson
1385 N.W. 15th Street
Miami, FL 33125
(305) 545-7822
FAX: (305) 325-1825
BY /S/
ARTHUR W. TIFFORD
(NY ID- 011481)
CERTIFICATE OF SERVICE
11
I hereby certify that on August 18, 2006, I electronically
filed the foregoing with the Clerk of the Court by using the
CM/ECF System, which will send notice of electronic filing to
the following:
Julie K. Lutz, Esq.
Attorney for Plaintiff
U.S. Securities and Exchange Commission
Central Regional Office
1801 California Street, Suite 4800
Denver, CO 80202-2648
Robert B. Blackburn, Esq.
Attorney for Plaintiff
U.S. Securities and Exchange Commission
233 Broadway, 11th Floor
New York, NY 10279
Marvin Pickholz, Esq.
Jason Pickholz, Esq.
Akerman Senterfitt LLP
335 Madison Avenue
Suite 2600
New York, NY 10017
John B. Harris, Esq.
Stillman & Friedman
425 Park Avenue
New York, NY 10022
Harry H. Wise, III, Esq.
770 Lexington Avenue, 6th Floor
New York, NY 10021
John A. Hutchings, Esq.
Dill Dill Carr Stonebraker & Hutchings, P.C.
455 Sherman Street, Suite 300
Denver, CO 80203
12
/S/
ARTHUR W. TIFFORD
13
______________________________________________
BARRY SCHAEVITZ, ESQ. (BS-3405)
JACOB MEDINGER & FINNEGAN, LLP
Local Counsel for Defendants,
Universal Express, Inc., Richard A.
Altomare, and Chris G. Gunderson
1270 Avenue Americas, 31s FL
New York, New York 10020
(212) 332-7773
(212) 332-7239 (facsimile)
and
ARTHUR W. TIFFORD, ESQ.
TIFFORD AND TIFFORD, P.A.
Lead Counsel for Defendants,
Universal Express, Inc., Richard A.
Altomare, and Chris G. Gunderson
1385 NW 15 STREET
MIAMI, FL 33125
(305) 545-7822
(305) 325-1825 (facsimile)
UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF NEW YORK
CASE NO. 04cv 02322 GEL
------------------------------------------x
U.S. SECURITIES AND EXCHANGE COMMISSION :
:
Plaintiff, :
:
v. :
:
UNIVERSAL EXPRESS, INC., RICHARD A. :
ALTOMARE, CHRIS G. GUNDERSON, MARK :
S. HEUHAUS, GEORGE J. SANDHU, SPIGA, :
LTD., AND TARUN MENDIRATTA, :
:
Defendants, :
------------------------------------------x
DECLARATION OF CHRIS GUNDERSON
(Electronically Filed)
CHRIS G. GUNDERSON, in his capacity as General Counsel for UNIVERSAL EXPRESS, INC. (“Universal”) and personally (“Gunderson”) files this declaration under penalties of perjury in support of Universal’s, Altomare’s and his own motion for partial summary judgment dismissing the Complaint’s First Claim for Relief (“the Universal partial summary judgment motion”). In doing so, he states and declares:
1. My name is Chris Gunderson. I am General Counsel for Universal since 1994. I make this declaration on personal knowledge or knowledge gained from published documents, or both, and all under penalty of perjury.
2. I have read the complaint in this case.
3. I have read Universal partial summary judgment
motion.
4. The factual matters set forth in the Universal partial summary judgment motion are true and correct. Specifically, the shares of Universal’s common stock referred to in the Complaint in this civil action were issued in accordance with and pursuant to Exhibit “I” of the confirmed Chapter 11 Plan for Universal.
5. Universal and I both believe that this case was undertaken by the SEC to gag Universal from continuing its public and increasingly hostile criticism of the SEC’s failure to implement action to stop the naked short selling manipulations of the stock of publicly traded U.S. companies, especially including Universal. The scandal is known as “Stockgate.”
6. The naked short selling manipulations reached catastrophic financial proportions by July 2001, the date of the Universal’s first multi-hundred million dollar judgment against some involved in its victimization through such a scheme combined with an advance fee swindle. The SEC’s exposure in what has already been publicly exposed despite its efforts to silence Universal, among others, is the result of its earning a fee on every naked short trade executed, along with the Depository Trust Clearing Corporation (“DTCC”) and the humongous scope of the scandal and the billions of dollars worth of unsettled naked short trades. The DTCC earned $425 Million in 2003 in revenues from services. The SEC earned approximately $500 Million in fees from all executed stock transactions. The portion each earned from naked shorting is currently still under investigation.
A very brief sampling of the Stockgate revelations and condemnations are filed as [Exhibit 3].
7. The instant action is part of the pattern
of the retaliatory and abusive conduct commenced by the SEC in June 2003 and continues to date through this very action. The pattern, however, did not become apparent to Universal until February 2004. At that point, the SEC’s Denver office had (i) issued no less than twelve subpoenas to the company with return dates as few as two working days, all deliverable to Denver, Colorado, (ii) contacted funders and other business people and advised them of the SEC’s request to communicate with them and “to have their lawyers present during the teleconference,” (iii) issued three subpoenas for testimony of USXP’S chief executive officer and general counsel in Miami, Florida. Each subpoena issued and contact with funders and other persons by the SEC was a reaction to the Universal’s criticism of the SEC’s handling of the naked short selling crisis.
8. The SEC commenced this action on March 24, 2004, twenty-two days following the filing of the action by Universal against it. At the time Universal filed that action, it did not know that the SEC had authorization to file this suit.
9. On information and belief, the SEC went to extraordinary measures to expedite obtaining authorization to file this action in the Southern District of New York only after it was put on notice of Universal’s lawsuit.
10. In addition to the forum-shopped civil lawsuit it filed against Universal in this Court, the SEC requested the United States Attorney’s Office to open a criminal investigation in the hopes that the persons involved in the New York action will assert their Fifth Amendment privilege during civil discovery and thereby attempt to take advantage by urging the court to draw negative inferences therefrom in this civil action. See Baxter v. Palmigiano, 96 S.Ct 1551 (1976).
11. Universal, Mr. Altomare and I, however, have answered all the non-privileged inquiries posed by the SEC in this action.
12. Publicly available facts prove, among other things, (i) the Commission ignored the Universal and others’ repeated voices of concern and increasing public criticism regarding naked short selling of stock years before the SEC’s formal order of investigation of Universal, Mr. Altomare and me was entered because the Commission has an enormous financial interest in allowing the continuation of naked short selling: its revenue of fees from each transaction (see ¶1 and n. 1 supra); (ii) the naked short selling of stock has turned into a nationwide scandal known as “StockGate” (see http://host.wallstreetcity.com/wsc2/Autoflag.html, for example Exhibit 3; (iii) by July 2001, the Stockgate scandal was well known within the SEC to have reached staggering dollar amounts, into the range of hundreds of billions of dollars; (iv) the SEC literally “sat on” a proposal initiated outside the Commission to ban naked shorting of stock for almost 2 ½ years, and even currently condones, if not fosters, delays in implementing material preventative measures; (v) Universal publicly and openly challenged the Commission before the latter’s purported investigation was initiated; (vi) Universal’s $389 million court judgment victory in July 2001 and later its $137 million judgment in April 2003 substantially fuelled the movement against the SEC and others to ban naked shorting; and (vii) I believe the SEC’s civil action in this court is nothing more than a transparent contrivance to “silence” Universal, the lynchpin of which is a misrepresentation.
13. The SEC’s essential misstatement in this civil action is its description of Universal’s common stock issuance to certain persons as “illegal, unregistered…shares.” In support of its complaint and its ex parte application for a preliminary injunction, the SEC represented that a search of its databases disclosed no registrations for the common stock shares in question. (Decl. Of Hugh Beck at ¶¶12, 13.) What the SEC did not inform this Court is that the subject Universal stock shares were duly and legally issued and sufficiently registered pursuant to law. The law involved was not and is not the normal domain of the SEC, the Securities Act of 1933 and Securities Exchange Act of 1934, both as amended, 15 U.S.C. et seq. §§77a et seq. and 78a et seq., but the United States Bankruptcy Code, 11 U.S.C. §101 et seq, particularly §§1123, 1125 and 1145. The SEC had knowledge that the shares in question were properly issued pursuant to the 1994 Stock Option Plan of Packaging Plus Services, Inc., Universal’s former name, but ignored that fact (see Hugh Beck depo).
14. The 1994 Stock Option Plan was part of the Reorganization Plan for the company [Exhibit 8], approved and confirmed by the United States Bankruptcy Court, Eastern District of New York, pursuant to Section 1125 of the Bankruptcy Code. [Exhibit 9]. The filing of the Stock Option Plan was and is a registration statement or its functional equivalent. It was filed with the SEC as part of the Reorganization Plan [Exhibit 8] and as a separate exhibit on Form 8-K as a part of the Company’s transition Report 10-KSB for the period ending June 30, 1994. Subsequently, and on an annual basis, its has been filed with the SEC as an exhibit to the company’s annual 10-KSB reports. Pursuant to law it is an S-8 registration covering advisors and consultants whose future need by Universal had been determined by the Bankruptcy Court for the long-term development of the company (10 years).
15. At all times I, as General Counsel for Universal, acted in good faith reliance on the following language in Sections 1123 of the Bankruptcy Code, 11 U.S.C. §1123, among others:
(a) Notwithstanding any otherwise applicable non-bankruptcy law, a plan shall
* * *
(5) provide adequate means for the plan’s implementation such as
* * *
(j) issuance of securities of the debtor . . . for cash, for property, for existing securities, or in exchange for claims or interests, or for any other appropriate purpose; . . . (emphasis added).
16. Once the Bankruptcy Court determined that Universal’s Reorganization Plan (the First Amended Plan of Reorganization and Disclosure Statement), including the 1994 Stock Option Plan contained “adequate information.” I acted in good faith reliance on Section 1125 of the Bankruptcy Code, which states that once such a finding is made by the bankruptcy court, no other law or rule governed Universal’s conduct. 11 U.S.C. §1125(d) which says,
Whether a disclosure statement required under subsection (b) of this section contains adequate information is not governed by any otherwise applicable nonbankruptcy law, rule, or regulation, but an agency or official whose duty is to administer or enforce such a law, rule, or regulation may be heard on the issue of whether a disclosure statement contains adequate information. Such an agency or official may not appeal from, or otherwise seek review of, an order approving a disclosure statement.
See also Section 1145, 11 U.S.C. §1145 cited in the motion.
17. The Bankruptcy Court’s determination was not and is not appealable by the SEC. 11 U.S.C. §1109(a).
18. Moreover, the company and persons acting for or with it are immune from suit arising from the issuance of securities under the Reorganization Plan and the 1994 Stock Option Plan pursuant to the safe harbor provisions of Section 1125(e), which provides in pertinent part:
A person . . that participates, in good faith and in compliance with the applicable provisions of this title, in the offer, issuance, sale, or purchase of a security, offered or sold under the plan, . . . is not liable, on account of such . . . participation, for violation of any applicable law, rule or regulation governing . . . the offer, issuance, sale, or purchase of securities. (emphasis added).
Dated this 18th day of August 2006
__________________________
CHRIS G. GUNDERSON
CERTIFICATE OF SERVICE
I hereby certify that on August 18, 2006, I electronically filed the foregoing with the Clerk of the Court by using the CM/ECF System, which will send notice of electronic filing to the following:
Julie K. Lutz, Esq.
Attorney for Plaintiff
U.S. Securities and Exchange Commission
Central Regional Office
1801 California Street, Suite 4800
Denver, CO 80202-2648
Robert B. Blackburn, Esq.
Attorney for Plaintiff
U.S. Securities and Exchange Commission
233 Broadway, 11th Floor
New York, NY 10279
Marvin Pickholz, Esq.
Jason Pickholz, Esq.
Akerman Senterfitt LLP
335 Madison Avenue
Suite 2600
New York, NY 10017
John B. Harris, Esq.
Stillman & Friedman
425 Park Avenue
New York, NY 10022
Harry H. Wise, III, Esq.
770 Lexington Avenue, 6th Floor
New York, NY 10021
John A. Hutchings, Esq.
Dill Dill Carr Stonebraker & Hutchings, P.C.
455 Sherman Street, Suite 300
Denver, CO
Respectfully submitted,
TIFFORD & TIFFORD, P.A.
Lead counsel for Universal,
Altomare and Gunderson
1385 N.W. 15th Street
Miami, FL 33125
(305) 545-7822
FAX: (305) 325-1825
BY /S/
ARTHUR W. TIFFORD
(NY ID- 011481)
Click Links Below For Easy Navigation:
1. Supreme Court Case
2. 150 Articles: SEC finally admits Naked Short Selling is a HUGE problem and a cause for financial crisis (July 15th, 2008 et. seq-September 15th, 2008 et. seq)
3. Richard Altomare's "Prison Inc." Book Excerpts
4. Universal Express Statement
5. Universal Express Recitation of Facts by General Counsel
6. Brief in Support of USXP Entitlement to Trial by Jury
7. Universal Express Complaint filed against SEC- March 3, 2004
8. USXP Full Page Ad in New York Times
9. Office of Inspector General Semi Annual Report to Congress- March 31, 2008
10. Richard Altomare's Speech on Naked Short Selling
11. USXP Quarterly and Annual Reports
12. Exhibit A and B: Universal Express Press Releases and Published Articles on Naked Short Selling 1998-2007
13. Universal Express Motion for Partial Summary Judgment
14. Supplemental Declaration of Chris G. Gunderson- Nov 13, 2006
15. Universal Express et al Motion for Reconsideration- March 8th, 2007
16. USXP Memo of Law in Support of Motion for Reconsideration
17. Universal's Declaration of General Counsel in Response to SEC's Request for a Receiver
Thursday, April 10, 2008
Universal Express Motion For Partial Summary Judgement....
Wednesday, April 9, 2008
Universal's Declaration of General Counsel in Response to SEC's Request for a Receiver
Below is Universal's 18 Page Declaration of General Counsel in Response to SEC's Request for a Receiver.
___________________________________________________
BARRY SCHAEVITZ, ESQ (BS-3405)
JACOB MEDINGER & FINNEGAN, LLP
Local Counsel for Defendants Universal
Express, Inc., Richard A. Altomare and
Chris G. Gunderson
1270 Avenue of the Americas, 31st Floor
New York, NY 10020
(212) 332-7773 (telephone)
(212) 332-7239 (facsimile)
and
ARTHUR W. TIFFORD, ESQ.
TIFFORD AND TIFFORD, P.A.
Lead Counsel for Defendants Universal
Express, Inc., Richard A. Altomare and
Chris G. Gunderson
1385 N.W. 15th Street
Miami, FL 33125
(305) 545-7822 (telephone)
(305) 325-1825 (facsimile)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
CASE NO. 04-CV-02322-GEL
U.S. SECURITIES AND EXCHANGE COMMISSION,
Plaintiff,
v.
UNIVERSAL EXPRESS, INC., etc., et al.,
Defendants.
_______________________________________________/
DECLARATION OF CHRIS G. GUNDERSON IN SUPPORT OF
UNIVERSAL EXPRESS, INC., RICHARD A. ALTOMARE AND
CHRIS G. GUNDERSON’S RESPONSE TO BOTH
SECURITY AND EXCHANGE COMMISSION’S MOTION TO APPOINT
RECEIVER AND MOTION FOR CIVIL CONTEMPT
(ELECTRONICALLY FILED)
STATE OF NEW YORK )
)ss:
NEW YORK COUNTY )
I, Chris G. Gunderson, make the following declaration under penalty of perjury, and say:
1. USXP (“the Company) appreciates the SEC staff’s critique of the Company’s businesses in the two pending motions for appointment of a receiver and civil contempt. It is clear, however, that few people at the SEC, including its many lawyers, ever ran an operating business, made payroll for employees or provided benefits for employees and their families. Our developing company, presently with 85 employees, under the direction of Mr. Richard A. Altomare (“Mr. Altomare”), has made hundreds of payrolls and provided benefits for its employees and their families for over 14 years.
2. The Company has developed, grown and been successful and recognized despite the unrelenting attack on the Company for over ten years by the naked shorters and Wall Street financial interests who sold into the market in the name of the Company billions of unregistered and counterfeit shares, collapsing the Company’s stock price from $2 to 2 cents and currently as low as .0003 per share. This national scandal of naked short selling, covered-up by the SEC for many years, has sucked the market capitalization from smaller public companies, putting over thousands of such companies out of business and destroying the investments and jobs of thousands of Americans, at the least. The “naked shorters” (marketmakers, broker-dealers and hedge funds) illegally sold trillions of unregistered and counterfeit shares in companies’ names in violation of federal securities and counterfeiting statutes of the United States and SEC rules, all ignored by the SEC. Instead, the SEC civilly prosecuted our Company, which has been properly issued and clearly recorded in our public filings for over 14 years.
3. The Company proved that naked short selling existed upon the attack on the Company’s shares. It showed that the volume of shares traded was 11 times the Company’s outstanding shares and more than 68 times its average daily volume. State court juries in Florida in 2001 and 2003 awarded the Company verdicts exceeding a total of $700,000,000 against naked shorters. Ordinary people on those two juries understood that “you can’t sell what you don’t own and never deliver,” which is the essence of naked shorting.
4. Despite the adverse effects of naked shorting, USXP’s businesses are developing and well. We have been developing a number of growing and successful businesses for a number of years after emerging from a bankruptcy court supervised “fresh start” reorganization in 1994. Mr. Altomare worked as the manager of the reorganization for three years with the Bankruptcy Court, Eastern District of New York, without compensation or payment of expenses, to develop ongoing new businesses for the Company, since the prior business of a franchisor of private postal and packaging stores had not been successful. The Bankruptcy Court provided long term arrangements in the Reorganization Plan (“The Plan”) and related documents to provide future protections and assistance to the Company in its expected and court-recognized long term development. One of the foremost aspects of The Plan was Mr. Altomare’s long-term employment agreement specifically approved by the court for his three years of uncompensated services as manager of the reorganization and in recognition of his important role in the future development of the Company. See generally Exhibit 10.
5. The “Altomare Employment Agreement” (Exhibit 10) was defined in and included as an exhibit to and an integral part of the Plan, as follows: “All Exhibits to the Plan are incorporated into the Plan, and shall be deemed included in the Plan, regardless of when Filed.” The Reorganization Plan specifically provides that the “(e)ntry of the Confirmation Order shall also constitute an order of the Bankruptcy Court … approving the Altomare Employment Agreement.”
6. In the Altomare Employment Agreement, the Bankruptcy Court defined his powers, duties and scope of responsibilities, as follows:
“WHEREAS, the Employee has been employed
as the President and Chief Executive Officer
of the Employer during a substantial portion
of its pending proceeding under Chapter 11
of the Bankruptcy Code (the ‘Bankruptcy
Proceeding’);” 1st “Whereas” Clause).
- “WHEREAS, the Employee has been instrumental
in the Employer’s efforts to successfully
terminate its Bankruptcy Proceeding and has
expended substantial time and money without
receiving compensation or reimbursement of
expenses;” (2nd “Whereas” Clause).
“WHEREAS, the Employer desires to assure the
continued employment and services of the
Employee;” (3rd “Whereas Clause”).
“WHEREAS, the Employee desires to continue
to devote his full time and attention to the business of the Employer.” (4th “Whereas” Clause).
“Employment”, Sec. 1.
“The Employer hereby employs the Employee as
President, Chairman of the Board and Chief
Executive Officer”…( Sec. 1-A)
“During the Employment Period … the Employee
shall direct and have responsibility for all
aspects of the Company’s operations, and shall
have such authority, discretion, power and responsibility…as are customary and appropriate to
his position and those currently exercised
by and afforded to him” (Sec. 1-B(i) )
“All officers of the Employer shall report,
directly or indirectly, to the Employee…”
(Sec. 1-B(iii) )
These powers and duties of Mr. Altomare under the Plan specifically include those powers and duties to be exercised by him in the future as those exercised and afforded to him as “manager” of the reorganization of the Company.
7. Since the reorganization, Mr. Altomare has developed a vibrant and creative Company. Among other things, he decided to create a unique “out-sourced” transportation company.
8. Mr. Altomare also determined not to continue the franchising of postal stores since franchisees were reluctant to pay any fees or make other payments to franchisors, which was the problem with the prior business. Instead he formed an association of such stores where no payments to the Company would be required. Instead, the Company arranged with various vendors, through group buying power, to provide goods and services to the postal stores. These programs vary and they were offered in numerous communications with the postal stores. There are presently 18 vendor offerings. Postal stores availing themselves of these goods and services would make arrangements with the vendors through the association. The association would receive commissions from the vendors on such arrangements. This “outsourcing” model emulated FTD, which has exactly the same concept for flower stores as the Company’s postal store association, now called Postal Nation. There are over 20,000 independent postal locations, franchised or not, in the United States, Canada and Europe.
9. The Company has built all of our other subsidiaries from luggage shipping to college shipping for students to lost luggage delivery from our initial concept of these postal locations being future electronic warehouses and possible future retail locations. At the present time, there are three unsolicited proposals being prepared at the request of the United States Postal Service for MadPackers (our college delivery system) Luggage Express (our innovative solution for movement of luggage for travelers) and our postal store direct proposals to ease the burden on the USPS, and further grow Postal Nation.
10. All of the Company’s subsidiaries offer services, products or ideas to these postal stores.
11. The Company’s present businesses include Luggage Express, Virtual Bellhop, USXP Logistics, Luggage Express Associates Program (LEAP), Inc., Luggage Express Found, MadPackers, Inc., Universal Express Courier Association, Postal Nation and Universal Jet Aviation.
(a) UniversalPost International Courier Service earns revenues from selling discounted rates and services to the postal stores.
(b) Luggage Express enables travelers to have their luggage picked up at their home by one of its carriers or a local UniversalPost member store and delivered to the traveler’s destination. This business was rated as the premier luggage delivery business by the Wall Street Journal.
(c) Virtual Bellhop® is a premier door-to-door luggage transportation service.
(d) MadPackers is a logistics subsidiary for shipping personal items for college and university students.
These divisions of Universal Express Logistics, Inc. have seen revenues more than triple in each of the corresponding fiscal quarters in the last five years.
(e) Universal Jet will appear in the Company’s next annual report. It is anticipated it will add in excess of $20,000,000 to the asset base of the Company.
12. The Company’s losses are not operating losses, but mainly relate to overhead and general administrative expenses in promoting the businesses of the Company, and accounting requirements. The Company recently has engaged in large promotions with sports teams in various national sports, NASCAR and in many other media venues and with public relations firms to promote our services, all essential long-term for developing businesses.
13. The Company’s business breakdowns for all of the fiscal years of its growth and development are set forth in Exhibit 6.
14. The Company’s background and businesses are further described in detail at its website and in related published articles (Exhibit 7). Its operations are mainly located in a four story building in Boca Raton, Florida. It also has offices in Miami with its Luggage Express Found business, New York City and Boston. Its revenues have grown in each fiscal year.
15. From July, 1998, the Company owned Skyworld International Couriers, Inc., one of the largest international delivery companies, which the Company developed in scope and growth. This business was sold by the Company in January, 2001.
16. From January, 1997 until May, 2001, the Company owned and developed the business of the largest licensed entertainment ticket agency in New York City, Downtown Theatre Ticket Agency, Inc. d/b/a “Manhattan Concierge”.
17. The Company has filed all of its 10-KSB and 10-QSB reports with the SEC for over 14 years. All the reports have been reviewed and audited by four different accounting firms over that period of time. All matters regarding the Company’s businesses and operations have been properly audited and accepted.
18. In 2006 and 2007, the Company’s June 30, 2005 and June 30, 2006 10-KSBs’ and 10QSB for the December 31, 2006 period were thoroughly reviewed by the Securities and Exchange Commission’s Division of Corporation Finance and all comments were completed and satisfied. This review by the SEC’s Division of Corporation Finance entailed more than three comment letters. The Company, its SEC counsel and its accountants’ detailed and satisfactory responses to the comments were accepted in full by the Division of Corporation Finance.
19. In the aforementioned SEC review, comment letter and responses process the Company filed three full amendments and restatements to its June 30, 2005 and June 30, 2006 10-KSB’s and to its December 31, 2006 10-QSB, with copies to the Division of Corporation Finance. These reviews included loans, receivables, stock rights, cash flows, stockholders equity,
The Company’s receiving funds from investors is substantially investments in “Stock Rights,” not securities. “Stock Rights” are defined in the Notes to the Company’s Consolidated Financial Statements, which, again, were specifically reviewed and approved by the Division of Corporation Finance. The definition of stock rights as approved by the SEC Division of Corporate Finance is:
“Stock rights represent amounts received
from investors for their future rights to
purchase restricted shares of stock of the
Company at prices to be negotiated with the
Company at a future date. At such future date,
as determined by the investor, the investor
will determine with the Company the price for
the shares and the investor and the Company
will enter into a Subscription Agreement for
the price per share and the amount of the
restricted shares will be set forth in
the Subscription Agreement. Sometime
thereafter, the amount of the restricted
shares set forth in the Subscription Agreement
will be issued from Treasury and transmitted to
the investor. The future price for the shares
are determined by the investor and the Company
dependent on the prospects for the Company, its development and other factors. The purchase price for shares under the Subscription Agreements have varied from $.0003 to $0.32 per share. The terms of the stock rights are only determined at the time the Subscription Agreement is entered into between the investor and the Company.”
21. An important factor for many of the Company’s current investors in stock rights is the naked shorting of the Company’s shares over a period of approximately 10 years and the prospect that if naked shorters are forced to cover their positions and buy in the market stock to deliver to the buyers, the price of the Company’s shares will rise substantially in the naked short squeeze.
22. In addition to stock rights, investors will invest directly in the Company’s restricted stock. During the last 18 months, the Company issued over four billion restricted shares to three individual investors under circumstances exempt from registration requirements of Section 5 of the Securities Act.
23. All of the Company’s stock issuances have been and are faithfully set forth in detail in its annual and quarterly reports to the SEC. The Company will produce and offer into evidence all of its Form 10QSB and Form 10KSB filings for the past 13 years, if necessary.
24. Shares issued for services are set forth in detail in the Company’s annual and quarterly reports. The Division of Corporation Finance of the SEC reviewed these details with respect to its recent audits and reviews. See ¶¶19, 20, 21, supra. The Notes to the Company’s Financial Statements reviewed with the Division of Corporation Finance covering this matter under “Deferred Compensation”, read as follows:
“Deferred Compensation is Stock issued to advisors for future services under an agreement for a specific term. The terms range anywhere from 3 months to 10 years. The stock is valued at market price on the date of issuance and is amortized and expensed based on the term of the agreement”.
25. The Division of Corporation Finance also reviewed, received satisfactory responses and accepted them from the Company on the “Related Party Receivable” for the spouse of the Chief Executive Officer. This has been on the accounts of the Company for over eight years. The applicable footnote, agreed to by the Division of Corporation Finance in its audits and reviews, reads as follows:
“As of June 30, 2006, the Company had
advanced $906,000 to the spouse of the
Chief Executive Officer, who is an employee
of the Company. These loans were advanced
from 1999-2003, pursuant to the First Amended
Plan of Reorganization of Packaging Plus
Services, Inc., that the Reorganization Court
approved on February 18, 1994 (the “Reorganization
Plan”) and the Long Term Employment Agreement
part of the Reorganization Plan, which
authorized the Chief Executive Officer of the
Company to receive loans from the Company.
In 1999, at the recommendation of the Company’s
then accountants, all future loans under the
Reorganization Plan and Employment Agreement
for the Chief Executive Officer were recorded in
the name of his spouse. The Company feels that
there is adequate security for the advances
based on the relationship of the borrower to
the Chief Executive Officer of the Company.
The Company has not yet determined repayment
terms of these advances.”
26. With respect to the Notes Receivable referred to in the Company’s Consolidated Balance Sheet of 3/31/07, this item is covered in Note 5 of page F-12 of 10KSB/A for the fiscal year ended June 30, 2006. This information was omitted from the SEC motions for receivership and civil contempt, probably through an oversight.
27. With all due respect to the Court’s conclusions in its February 21, 2007 opinion and order, Universal Express has never issued a false press release. Despite the hysterical exhortations of the SEC, the deposition records in this case will show that the constructs by the SEC that selected press releases were false were contradicted during the respective witnesses’ cross examination, and it was clearly established that each challenged press release was accurate.
28. In 2003, the Denver office SEC commenced a program of harassment against the Company, with more than 13 subpoenas for documents. The Company initially volunteered to provide information on the contracts for proposed acquisitions and funding sources for those acquisitions. Before these documents were even received by the attorneys from the Denver office they were calling those acquisition candidates’ senior officers, threatening them with reprisals so that they would move away from the Company. This pattern of intimidation was successful, since a number of large acquisitions in progress valued at more than $800 Million Dollars were terminated.
29. The SEC’s attack on Universal Express as a whistleblower on naked shorting was in full swing in 2003, and continues to date, with recent harassing inquiries on behalf of the SEC’s Denver office within the last few days to the resident agent for its landlord of the Company’s Florida location, stating that the SEC was seeking a receivership of the Company and inquiring if the Company was in default under its lease. The Company is not in default under the lease, which lease has been in effect for over eight years. The landlord and its agent, however, have become anxious and constrained toward the Company as a result of this totally improper inquiry designed to injure the Company. There have been other recent improper inquiries by the SEC with others with whom the Company does business, furthering what now firmly appears to be a continuing pattern of behind-the-scenes activities to damage the Company.
30. The reference to the Jackson Family memorabilia displays a lack knowledge of the true circumstances. In truth and in fact, Universal Express’ title to the collection was derived from its contract with Vintage. Before the proposed initial auction, claimants to some of the thousands of items attempted to stop the auction in three different jurisdictions, Nevada, New York and New Jersey. These attempts were defeated, but the auction was damaged in its anticipated results. Some of matters continue in litigation, mostly in the Chancery Division, Superior Court of New Jersey, Monmouth County. On July 3, 2007, that Court, upon an order to show cause filed on behalf of Vintage, conducted a full evidentiary hearing and has issued temporary restraining orders against various claimants, including Janet and Michael Jackson (the original Nevada parties), pending a further hearing before the Court with respect to such claimants to some of the Jackson Family memorabilia. It is anticipated that upon the resolution of the New Jersey action to affirming title to Vintage, further auctions and sales will be held Universal Express with anticipated substantial favorable financial results.
31. Mr. Altomare’s officer positions, powers and his prominence in the affairs of Universal Express were specifically provided for in great detail by the Bankruptcy Court in the Company’s Reorganization Plan and Disclosure Statement. These powers, positions and immunities were directed by the Bankruptcy Court to continue long-term during the developmental stage of the Company, and they continue to date, except to the extent this Court’s judgment may be affirmed as properly encroaching upon the final order of the Bankruptcy Court.
33. The Company has at all times acted in good faith reliance on the orders of the Bankruptcy Court, the long-term provisions of the Reorganization Plan, confirmed by the Bankruptcy Court and the immunities provided to the Company and its officers under the Bankruptcy Code.
34. The undersigned, as General Counsel of the Company for over 12 years, provided the Denver office of the SEC with copies of the reorganization documents in response to their initial subpoena for share-issuance documents. They chose to ignore this and chose to charge the Company for unregistered shares, when in fact they were and have been properly issued and registered.
35. On April 21, 2006, I testified at my continued deposition extensively concerning the Company’s Reorganization Plan, the included Stock Incentive Plan and Altomare Employment Agreement. To silence and no cross examination, I described those documents filed many times with the SEC, placed in evidence each such document constituting the functional equivalent to the S-8 registration, placed into evidence copies of the immunity from suit provisions of the Bankruptcy Code and the daily recapitalization of the Company caused by the naked shorting of our shares and the clear right of the Company to cover those counterfeit and unregistered shares by shares properly issued by the Company under its Reorganization Plan and the provisions of the Bankruptcy Code.
Dated: July 26, 2007.
______________________________
CHRIS G. GUNDERSON
Click Links Below For Easy Navigation:
1. Supreme Court Case
2. 150 Articles: SEC finally admits Naked Short Selling is a HUGE problem and a cause for financial crisis (July 15th, 2008 et. seq-September 15th, 2008 et. seq)
3. Richard Altomare's "Prison Inc." Book Excerpts
4. Universal Express Statement
5. Universal Express Recitation of Facts by General Counsel
6. Brief in Support of USXP Entitlement to Trial by Jury
7. Universal Express Complaint filed against SEC- March 3, 2004
8. USXP Full Page Ad in New York Times
9. Office of Inspector General Semi Annual Report to Congress- March 31, 2008
10. Richard Altomare's Speech on Naked Short Selling
11. USXP Quarterly and Annual Reports
12. Exhibit A and B: Universal Express Press Releases and Published Articles on Naked Short Selling 1998-2007
13. Universal Express Motion for Partial Summary Judgment
14. Supplemental Declaration of Chris G. Gunderson- Nov 13, 2006
15. Universal Express et al Motion for Reconsideration- March 8th, 2007
16. USXP Memo of Law in Support of Motion for Reconsideration
17. Universal's Declaration of General Counsel in Response to SEC's Request for a Receiver
Tuesday, April 8, 2008
Universal Express et al Motion Reconsideration March 8th, 2007
Below is the 23 page Universal Express et al motion for reconsideration of the denial of their motion for partial summary judgment of dismissal the granting of the plaintiff's motion for partial summary judgment.
For media and other inquiries that would like PDF versions of all 17 major posts via email please send request to usxpshareholders(at)gmail(com).
BARRY SCHAEVITZ, ESQ (BS-3405)
JACOB MEDINGER & FINNEGAN, LLPLocal Counsel for Defendants Universal
Express, Inc., Richard A. Altomare andChris G. Gunderson
1270 Avenue of the Americas, 31st Floor
New York, NY 10020
(212) 332-7773 (telephone)
(212) 332-7239 (facsimile)
and
ARTHUR W. TIFFORD, ESQ.
TIFFORD AND TIFFORD, P.A.
Lead Counsel for Defendants Universal
Express, Inc., Richard A. Altomare andChris G. Gunderson
1385 N.W. 15th Street
Miami, FL 33125
(305) 545-7822 (telephone)
(305) 325-1825 (facsimile)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
CASE NO. 04-CV-02322-GEL
U.S. SECURITIES AND EXCHANGE COMMISSION,
Plaintiff,
v.
UNIVERSAL EXPRESS, INC., etc., et al.,
Defendants.
_______________________________________________/
MOTION OF DEFENDANTS UNIVERSAL EXPRESS, INC.,
RICHARD A. ALTOMARE AND CHRIS G. GUNDERSON
FOR RECONSIDERATION OF THE
DENIAL OF THEIR MOTION FOR PARTIAL SUMMARY JUDGMENT OF
DISMISSAL THE GRANTING OF THE PLAINTIFF’S MOTION FOR
PARTIAL SUMMARY JUDGMENT
(ELECTRONICALLY FILED)
1
Defendants Universal Express, Inc. (“Universal” or “USXP”),
Richard A. Altomare (“Altomare”) and Chris G. Gunderson
(“Gunderson”), by their undersigned attorneys and pursuant to
Rule 56, Federal Rules of Civil Procedure, respectfully move for
reconsideration of the Court’s February 21, 2007 order in the
above styled civil action awarding a partial summary judgment to
the Plaintiff and denying their motion for partial summary
judgment of dismissal. (D.E. #172). As demonstrated in the
following and the memorandum of law, the Court overlooked or
misperceived pertinent facts of record and the applicable
provisions of the bankruptcy code which require reconsideration.
On reconsideration this Court should conclude that (i) there
exists no genuine issues of material fact as to Defendants’
motion, (ii) as a matter of law, Universal, Altomare and
Gunderson are entitled to the dismissal of the Complaint’s First
Claim For Relief, which alleges violations of §§ 5(a) and 5(c)
of the Securities Act of 1933, 15 U.S.C. §§ 77e(a)1 and 77e(c),2
1 Section 5(a) of the Securities Act of 1933, 15 U.S.C. §
77e(a), is entitled “Sale or delivery after sale of unregisteredsecurities” and provides:
Unless a registration statement is in effect as to a
security, it shall be unlawful for any person,
directly or indirectly--
2
or (iii) questions of fact required trial by jury on the good
faith reliance issues.
DISCUSSION
I THE FACTUAL SETTING; STATEMENT OF UNDISPUTED FACTS.
As their statement of undisputed facts the movants
incorporate by reference the factual setting below, the facts
set forth in the below memorandum of law, the deposition and the
(1) to make use of any means or instrumentsof transportation or communication ininterstate commerce or of the mails to sell
such security through the use or medium ofany prospectus or otherwise; or
(2) to carry or cause to be carried throughthe mails or in interstate commerce, by anymeans or instruments of transportation, anysuch security for the purpose of sale or fordelivery after sale.
2 Section 5(c) of the Securities Act of 1933, 15 U.S.C. §
77e(c), is entitled “Necessity of filing registration statement”
and provides:
It shall be unlawful for any person, directly orindirectly, to make use of any means or instruments oftransportation or communication in interstate commerceor of the mails to offer to sell or offer to buythrough the use or medium of any prospectus orotherwise any security, unless a registrationstatement has been filed as to such security, or whilethe registration statement is the subject of a refusalorder or stop order or (prior to the effective date ofthe registration statement) any public proceeding orexamination under section 77h of this title.
3
declaration of Chris G. Gunderson and its exhibits.
Universal was organized in the State of Delaware on January
16, 1986. It merged into Packaging Plus Services, Inc. (“PPS”),
a Nevada corporation, on April 2, 1986, and filed in the State
of Nevada on June 2, 1986. The Nevada corporation survived the
merger and changed its domicile to the State of Delaware was but
a dormant public company organized on April 8, 1983 as Silver-
Gold Reclamation, Ltd.
On December 19, 1991, PPS filed for reorganization under
Chapter 11, Bankruptcy Code, in the U.S. Bankruptcy Court,
Eastern District of New York (“the Bankruptcy Court”). In re:
Packaging Plus Services, Inc., Debtor, Case No. 191-18486-260
(Hon. Conrad B. Duberstein, U.S. Bankruptcy Judge). Thereafter,
the Bankruptcy Court removed all officers and directorships of
PPS and installed Altomare as its President and Chief Executive
Officer, which positions he continues to hold.
On February 18, 1994, on the Bankruptcy Court confirmed
PPS’s Plan of Reorganization (“the Chapter 11 Plan”).
Thereafter PPS changed its name to Universal Express, Inc., and
Gunderson was appointed as its General Counsel, which position
he has held to this date.
II THE STATUTORY FRAMEWORK
4
Three sections of the Bankruptcy Code control the
disposition of this case upon trial by jury, and these
provisions supersede any section of the securities laws of the
United States offered by the Plaintiff. These sections and
§1123, 1125 and 1145.
Section 1123, Bankruptcy Code, 11 U.S.C. §1123, provides in
pertinent part:
(a) Notwithstanding any otherwise applicable non-
bankruptcy law, a plan shall
* * *
(5) provide adequate means for the plan’s implementationsuch as
* * *
(j) issuance of securities of the debtor…for cash, forproperty, for existing securities, or in exchange for
claims or interests, or forany other appropriate purpose;…(emphasis added)
Section 1125, Bankruptcy Code, 11 U.S.C. § 1125, is
entitled “Post petition disclosure and solicitation” provides in
pertinent part:
(e) A person that solicits acceptance or rejection ofa plan, in good faith and in compliance with theapplicable provisions of this title, or that
participates, in good faith and in compliance with the
applicable provisions of this title, in the offer,
issuance, sale, or purchase of a security, offered orsold under the plan, of the debtor, of an affiliateparticipating in a joint plan with the debtor, or of a
newly organized successor to the debtor under the
5
plan, is not liable, on account of such solicitation
or participation, for violation of any applicable law,
rule, or regulation governing solicitation of
acceptance or rejection of a plan or the offer,
issuance, sale, or purchase of securities.
(emphasis added.
Section 1145, Bankruptcy Code, 11 U.S.C. § 1145, is
entitled “Exemption from Securities Laws” and in pertinent part
provides:
(a) Except with respect to an entity that is anunderwriter as defined in subsection (b) of thissection, section 5 of the Securities Act of 1933 and
any State or local law requiring registration foroffer or sale of a security or registration or
licensing of an issuer of, underwriter of, or brokeror dealer in, a security do not apply to—
(1) the offer or sale under a plan of asecurity of the debtor, of an affiliateparticipating in a joint plan with thedebtor, or of a successor to the debtor
under the plan--
(A) in exchange for a claimagainst, an interest in, or aclaim for an administrative
expense in the case concerning,
the debtor or such affiliate; or
(B) principally in such exchangeand partly for cash or property;
(2) the offer of a security through anywarrant, option, right to subscribe, orconversion privilege that was sold in the
manner specified in paragraph (1) of thissubsection, or the sale of a security uponthe exercise of such a warrant, option,
right, or privilege;
6
(3) the offer or sale, other than under aplan, of a security of an issuer other thanthe debtor or an affiliate, if--
(A) such security was owned bythe debtor on the date of the
filing of the petition;
(B) the issuer of such securityis--
(I) required to filereports under section 13or 15(d) of theSecurities Exchange Actof 1934; and
(ii) in compliance withthe disclosure and
reporting provision ofsuch applicable section;
and
(C) such offer or sale is of
securities that do not exceed--
(I) during the two-yearperiod immediatelyfollowing the date ofthe filing of thepetition, four percentof the securities of
such class outstandingon such date; and
(ii) during any 180-dayperiod following suchtwo-year period, onepercent of thesecurities outstandingat the beginning of such180-day period; or
(4) a transaction by a stockbroker in a
7
security that is executed after a
transaction of a kind specified in paragraph
(1) or (2) of this subsection in suchsecurity and before the expiration of 40days after the first date on which suchsecurity was bona fide offered to the publicby the issuer or by or through anunderwriter, if such stockbroker provides,
at the time of or before such transaction bysuch stockbroker, a disclosure statementapproved under section 1125 of this title,
and, if the court orders, informationsupplementing such disclosure statement.
(emphasis added)
III THE PLAN’S EXHIBIT “I”
Exhibit “I” to the Chapter 11 Plan, entitled “1994 Stock
Option Plan”, also regularly referred to by Universal as the
“Stock Incentive Plan”, provided in pertinent part:
This Plan shall be known as the “1994 Stock OptionPlan”, (the “Plan”). The purpose of this Plan is toprovide a method to give incentive to those persons orentities who, in the sole and absolute discretion ofthe Board of Directors of Packaging Plus Services,
Inc., a Delaware corporation (“the Company”), are
responsible for the management, growth, and/orprotection of the Company’s business and who are
making and can continue to make substantialcontributions to the success of the Company’s businessincluding, but not limited to, present and futureofficers, directors, employees, consultants,
franchisees and professional advisors of the Companyor any future Parent or Subsidiary.
It is anticipated that the Plan will encourage them toacquire capital stock ownership in the Company, thusgiving them a, or increasing their, proprietaryinterest in the Company, providing them with greaterincentive and encouraging their continuance in theservice, and promoting the interests, of the Company
8
and all of its stockholders...
* * * * * * * * *
The shares to be issued upon exercise of options which
are granted pursuant to this Plan shall be madeavailable, at the discretion of the Board ofDirectors, either from the authorized but unissuedshares of Common Stock or from shares of Common Stock
which are reacquired by the Company, including shareswhich are purchased in the open market.
There will be reserved for use upon the exercise ofoptions which may be granted pursuant to this Plan anaggregate of 1,250,000 shares of Common Stock.
* * * * * * * * *
However,
If the number of outstanding shares of Common Stock ofthe Company shall be changed by reason of anyrecapitalization, stock split, or stock dividend, theaggregate number and kind of shares for which optionsmay thereafter be granted under this Plan and thenumber of shares subject to options theretoforegranted under and the price per share payable uponexercise of such options shall be adjusted asdetermined by the Plan Administrators, in their soleand absolute discretion, so as to reflect such change;
provided, however, that no such adjustment shall bemade by reason of the issuance of additional shares ofthe Company for services, property or money regardlessof whether the Company received adequateconsideration.
* * * * * * * * *
And,
Unless sooner terminated, this Plan shall terminate onthe tenth (10th) anniversary date of the earlier of thedate upon which this Plan is adopted or the date uponwhich this Plan is approved by the stockholders of the
Company; provided, however, that all options which are
9
granted under this plan shall continue in full forceand effect until terminated in accordance with the
terms and conditions of the options and this Plan.
This Plan will be submitted to the stockholders of the
Company for approval by the holders of a majority ofthe outstanding shares of Common Stock of the Company.
(emphasis added).
IV THE CONFIRMED CHAPTER 11 PLAN
Paragraph VI.F of the confirmed Chapter 11 Plan provided:
The protection afforded by Bankruptcy Code section1125 with regard to the solicitation of acceptances orrejections of the Plan and with regard to the offer,
issuance, sale, or purchase of the Post petitionSenior Secured Notes and the New Common Stock and New
Warrants issued and distributed to the holders of
Claims and Administrative Claims or in connection with
the Plan and the Confirmation Order, shall apply tothe full extent provided by law. The entry of theConfirmation Order shall constitute the determination
by the Bankruptcy Court that Reorganized PPS, PPS, andeach of their respective officers, directors,
partners, employees, members or agents, and eachProfessional Person, attorney, accountant, or otherprofessional employed by any of them, shall have actedin good faith and in compliance with the applicableprovisions of the Bankruptcy Code pursuant toBankruptcy Code section 1125 and the federalsecurities laws. In addition, the exemption from therequirements of section 5 of the Securities Act andany state or local law requiring registration for theoffer or sale of a security provided for in BankruptcyCode section 1145 shall apply to the New Common Stock,
the New Warrants, and the Warrants Shares to be issuedunder the Plan in exchange for any Claim against orinterest in PPS. Entry of the Confirmation Ordershall also constitute an order of the Bankruptcy Courtthat the Debtor has, by virtue of its public filings,
complied with the reporting requirements of theSecurities Act of 1934 through the Effective Date.
Upon Confirmation, however, as a publicly heldcorporation the Debtor remains subject to Securities
10
and Exchange Commission reporting requirements and
subsequent to Confirmation of the Plan and theReorganized PPS intends to comply with all periodicreporting requirements including Section 12(g) of theSecurities Exchange Act of 1934. (emphasis added).
V THE GUNDERSON DECLARATION
Attached to these defendants’ motion for partial summary
judgment as Exhibit “A” was the declaration and supplemental
declaration of Gunderson, the contents of which were
incorporated therein and are incorporated herein by reference
(“the Gunderson declaration”). The declaration establishes that
the shares of Universal’s common stock referred to in the
Complaint in this civil action were issued in accordance with
and pursuant to Exhibit “I” of the confirmed Chapter 11 Plan.
The Plaintiff has not filed of record any evidence to contradict
Mr. Gunderson’s declaration; nor could the Plaintiff offer such
evidence in good faith. Specifically the declaration provides:
5.***The scandal is known as “Stockgate.”
6. The naked short selling manipulationsreached catastrophic financial proportions byJuly 2001, the date of the Universal’s firstmulti-hundred million dollar judgment againstsome involved in its victimization through sucha scheme combined with an advance fee swindle.
The SEC’s exposure in what has already beenpublicly exposed despite its efforts to silenceUniversal, among others, is the result of itsearning a fee on every naked short trade executed,
along with the Depository Trust Clearing Corporation(“DTCC”) and the humongous scope of the scandal
11
and the billions of dollars worth of unsettled
naked short trades. The DTCC earned $425
Million in 2003 in revenues from services.
The SEC earned approximately $500 Million in
fees from all executed stock transactions.
The portion each earned from naked shorting
is currently still under investigation.
A very brief sampling of the Stockgate revelations
and condemnations are filed as [Exhibit 3].
7. The instant action is part of the patternof the retaliatory and abusive conduct commencedby the SEC in June 2003 and continues to datethrough this very action. The pattern, however,
did not become apparent to Universal untilFebruary 2004. At that point, the SEC’s Denveroffice had (i) issued no less than twelve subpoenasto the company with return dates as few as twoworking days, all deliverable to Denver, Colorado,
(ii) contacted funders and other business peopleand advised them of the SEC’s request to communicatewith them and “to have their lawyers present duringthe teleconference,” (iii) issued three subpoenasfor testimony of USXP’S chief executive officerand general counsel in Miami, Florida.3 Each subpoenaissued and contact with funders and other persons by theSEC was a reaction to the Universal’s criticism of the
SEC’s handling of the naked short selling crisis.4
3 General counsel resides in New York.
The SEC has incorrectly stated to another federal districtcourt that its investigation preceded Universal’s concerns andcriticisms towards naked short-selling of stock and the SEC’sposition regarding naked short-selling of stock. Universal
first made contact with the SEC regarding naked short-selling ofstock and its effect on the company in January 1998. In
addition, the exhibits to this Declaration confirm the SEC’sawareness of the mind-boggling amount of money the big moneybrokerages, among others, will have to cover when the small-
capitalized companies in the United States continue to demand“delivery of shares at settlement,” and its own responsibilityfor allowing the scandal to go unremedied.
12
8. The SEC commenced this action on March 24,2004, twenty-two days following the filing of theaction by Universal against it.5 At the time
Universal filed that action, it did not knowthat the SEC had authorization to file this suit.
9. On information and belief, the SECwent to extraordinary measures to expediteobtaining authorization to file this actionin the Southern District of New York only afterit was put on notice of Universal’s lawsuit.
10. In addition to the forum-shopped civillawsuit it filed against Universal in thisCourt, the SEC requested the United StatesAttorney’s Office to open a criminal investigationin the hopes that the persons involved in the NewYork action will assert their Fifth Amendment
privilege during civil discovery and thereby attemptto take advantage by urging the court to drawnegative inferences therefrom in this civil action.
See Baxter v. Palmigiano, 96 S.Ct 1551 (1976).6
11. Universal, Mr. Altomare and I, however,
have answered all the non-privileged inquiriesposed by the SEC in this action.
12. Publicly available facts prove, amongother things, (i) the Commission ignored theUniversal and others’ repeated voices of concernand increasing public criticism regarding nakedshort selling of stock years before the SEC’sformal order of investigation of Universal,
Mr. Altomare and me was entered because the
Commission has an enormous financial interest
5 The case, now closed, was styled, Universal Express, Inc. v.
Securities and Exchange Commission, United States District Courtfor the Southern District of Florida Case No. 04-20481-CIVJORDAN/
BROWN
Baxter does not go nearly as far as many civil litigatorsbelieve, and, often argue, as a result of its unique and verylimited facts.
13
in allowing the continuation of naked shortselling: its revenue of fees from each
transaction (see ¶1 and n. 1 supra); (ii) thenaked short selling of stock has turned intoa nationwide scandal known as “StockGate”
(see http://host.wallstreetcity.com/wsc2/Autoflag.html,
for example Exhibit 3; (iii) by July 2001, theStockgate scandal was well known within the SECto have reached staggering dollar amounts, intothe range of hundreds of billions of dollars; (iv)
the SEC literally “sat on” a proposal initiated outside theCommission to ban naked shorting of stock for almost2 • years, and even currently condones, if not fosters,
delays in implementing material preventative measures;
(v) Universal publicly and openly challenged theCommission before the latter’s purported investigationwas initiated; (vi) Universal’s $389 million courtjudgment victory in July 2001 and later its $137million judgment in April 2003 substantially fuelledthe movement against the SEC and others to ban nakedshorting; and (vii) I believe the SEC’s civil actionin this court is nothing more than a transparentcontrivance to “silence” Universal, the lynchpinof which is a misrepresentation.
13. The SEC’s essential misstatement in this
civil action is its description of Universal’scommon stock issuance to certain persons as“illegal, unregistered…shares.” In support ofits complaint and its ex parte application fora preliminary injunction, the SEC represented thata search of its databases disclosed no registrationsfor the common stock shares in question.
(Decl. Of Hugh Beck at ¶¶12, 13.) What the SEC
did not inform this Court is that the subjectUniversal stock shares were duly and legallyissued and sufficiently registered pursuant to law.
The law involved was not and is not the normal
domain of the SEC, the Securities Act of 1933 andSecurities Exchange Act of 1934, both as amended,
15 U.S.C. et seq. §§77a et seq. and 78a et seq.,
but the United States Bankruptcy Code, 11 U.S.C.
§101 et seq, particularly §§1123, 1125 and 1145.
The SEC had knowledge that the shares in question
14
were properly issued pursuant to the 1994 StockOption Plan of Packaging Plus Services, Inc.,
Universal’s former name, but ignored that fact(see Hugh Beck depo).
14. The 1994 Stock Option Plan was part of theReorganization Plan for the company [Exhibit 8],
approved and confirmed by the United StatesBankruptcy Court, Eastern District of New York,
pursuant to Section 1125 of the Bankruptcy Code.
[Exhibit 9]. The filing of the Stock Option Planwas and is a registration statement or itsfunctional equivalent. It was filed with the SEC
as part of the Reorganization Plan [Exhibit 8]
and as a separate exhibit on Form 8-K as a partof the Company’s transition Report 10-KSB for theperiod ending June 30, 1994. Subsequently, andon an annual basis, its has been filed with the SECas an exhibit to the company’s annual 10-KSB reports.
Pursuant to law it is an S-8 registration coveringadvisors and consultants whose future need byUniversal had been determined by the BankruptcyCourt for the long-term development of thecompany (10 years).
15. At all times I, as General Counsel forUniversal, acted in good faith reliance onthe [following] language in Sections 1123 ofthe Bankruptcy Code, 11 U.S.C. §1123, among others:
(a) Notwithstanding any otherwise applicablenon-bankruptcy law, a plan shall
* * *
(5) provide adequate means for the plan’simplementation such as
* * *
(j) issuance of securities of the debtor . .
. for cash, for property, for existingsecurities, or in exchange for claims or
15
interests, or for any other appropriatepurpose; . . . (emphasis added).
16. Once the Bankruptcy Court determinedthat Universal’s Reorganization Plan (the FirstAmended Plan of Reorganization and DisclosureStatement), including the 1994 Stock Option Plancontained “adequate information.” I acted in
good faith reliance on Section 1125 of theBankruptcy Code, which states that once sucha finding is made by the bankruptcy court, noother law or rule governed Universal’s conduct.
11 U.S.C. §1125(d) which says,
‘Whether a disclosure statement requiredunder subsection (b) of this section
contains adequate information is not
governed by any otherwise applicablenonbankruptcy law, rule, or regulation, butan agency or official whose duty is to
administer or enforce such a law, rule, orregulation may be heard on the issue ofwhether a disclosure statement contains
adequate information. Such an agency orofficial may not appeal from, or otherwiseseek review of, an order approving a
disclosure statement.’
See also Section 1145, 11 U.S.C. §1145cited in the motion.
17. The Bankruptcy Court’s determination wasnot and is not appealable by the SEC.
11 U.S.C. §1109(a).
18. Moreover, the company and personsacting for or with it are immune from suitarising from the issuance of securitiesunder the Reorganization Plan and the 1994Stock Option Plan pursuant to the safe harborprovisions of Section 1125(e), which providesin pertinent part:
16
A person . . that participates, in goodfaith and in compliance with the applicableprovisions of this title, in the offer,
issuance, sale, or purchase of a security,
offered or sold under the plan, . . . is not
liable, on account of such . . .
participation, for violation of anyapplicable law, rule or regulation governing. . . the offer, issuance, sale, or purchaseof securities. (emphasis added).
Mr. Gunderson also testified unrefuted that the
number of shares of USXP stock that could be issued as
part of the Bankruptcy Code approved Plan could be and
in fact regularly was increased as a result of the
daily recapitalization of the company due to the
unabated, wild naked short selling of the USXP stock
which the SEC ignored for over six (6) years. The
pertinent portions of Gunderson’s testimony include:
A. Shares issued under the stock option planwere to consultants or advisors, were free
trading shares that could be sold by them if theywanted to do that because the 1994 stock optionplan is a functional S8 registration coveringconsultants and advisors as determined by thebankruptcy court.
Q. Where in the plan do you see that it statesthat shares issued to consultants or advisors are
free trading?
A. The plan does not restrict the shares to acertain type of shares as restricted shares.
It’s a question of interpretation of the plan.
And the fact that the plan was filed with theSecurities & Exchange Commission as a functional
17
equivalent of an S8 as authorized by the
bankruptcy court in Section 1125, 1112 and 1109of the bankruptcy code.
Q. Do you see Page 2 of the 1994 stock optionplan in Paragraph 3 entitled Stock Subject tothis Plan?
There will be reserve for use, upon theexercise of options which may be granted pursuantto this plan, an aggregate of 1,250,000 shares ofcommon stock?
A. Yes.
Q. Was this plan ever amended to increase thatnumber of shares?
A. The plan is automatically amended under theexpander provision contained in – in the fourthparagraph of Section 3.
Q. And it’s the top of Page 3?
A. Yes.
Q. Were there any records of the number oshares that were automatically – what – increasedunder this plan –-
What is the word you used?
* * *
A. The issuance of shares sold in the name of
the company by those that have sold shares, thenaked shortings in transactions where
transactions are sold by sellers to buyers asshates of the company and in the name of thecompany, are and do constitute an increase in thenumber of outstanding shares of the company, andthat amount of shares issued in the
recapitalization of the company under the nakedshorting situation increases and has resulted in
18
an increase in the company’s outstanding shareson the books of the company issued by the companyfrom treasury.
Q. Were the number of shares authorized by thisplan ever increased because of a stock split?
A.
No.
Q.
Were there the number of shares authorized
by this plan ever increased because of astock dividend?
A.
There were documented dividends that the
company issued.
And those would have increased the
outstanding shares of the company.
Q.
But did it increase the number of shares
that could be issued pursuant to this 1994stock option plan?
A.
The stock dividend might be issued by the
company, would be issued to known
stockholders of the company who hold sharesof the company issued from the company’streasury. And the issuance of a stock
dividend would be for consideration, and
that is that the shareholder, as a valuedshareholder, receives a stock dividend andhis continued shareholding is part of theconsideration of the company.
The shares recapitalized, the outstandingshares of the company that have been
recapitalized as a result of the naked
shorter situation, are shares that have notbeen issued by the company but are issued inthe name of the company and constitute theoutstanding shares of the company in thename of the company, and their multiplier isabout 11 – in excess of 11 of the
19
outstanding shares of the company on thecompany books.
And therefore, the company is entitled toissue additional shares under this expanderprovision to advisors and consultants underthis stock option plan.
Q.
Did you calculate the daily recapitalizationunder the provisions of this 1994 stock
option plan?
A.
The company is unable to ascertain the
amount of shares that have been sold in the
naked shorting situation because the totalamount of outstanding shares that have beenissued by the nake shorting, the company isunable to quantify that at any one time.
* * *
Q.
Did anyone at Universal Express calculate ona daily basis the recapitalization of thestock and apply it to this 1994 stock optionplan?
A.
We were unable to calculate and I was in a
position to calculate the effect on the
company of the naked shorting position ofincreasing an increased outstanding sharesin the market in the name of the companythat were issued in the name of the companybut do not actually exist as shares
certification.
* * *
As a result of that capitalization andbecause the naked shorting situation has
continued unabated, the company is under theposition under the standard clause of thestock option agreement to issue additionalshares to consultants and advisors under the
1994 stock option plan.
20
* * *
Gunderson depo sworn to 21 April 2006 at 145-158.
VI ARGUMENT
Because (i) the shares of Universal’s common stock referred
to in the Complaint in this civil action were issued in
accordance with and pursuant to Exhibit “I” of the confirmed
Chapter 11 Plan, under §§ 1125(e) and 1145(a) of the Bankruptcy
Code, supra, (ii) these Defendants’ actions with respect to
shares issued pursuant to the Plan were in good faith reliance
of the Bankruptcy Court’s confirmation of the Plan; (iii) the
number of shares of the Plan were subject to the Plan’s expander
clause; (iv) the number of shares Universal sold to the
consultants as it did due to the scandalous “naked shorting”
tolerated and even fostered by the SEC and (v) these Defendants
good faith actions are immune from suit pursuant to the
Bankruptcy Code, §1125, they were exempt from the registration
requirements of §§ 5(a) and 5(c) of the Securities Act of 1933,
15 U.S.C. §§ 77e(a) and 77e(c), supra, Universal, Altomare and
Gunderson are entitled to a partial summary judgment dismissing
the Complaint’s First Claim For Relief, and the Plaintiff’s
summary judgment moton must be denied.
21
Because these Defendants’ good faith actions inherently
involved questions of fact reserved to the jury, the Plaintiffs’
summary judgment motion as to the first claim also must be
denied.
VII CONCLUSION
The motion of Universal, Altomare and Gunderson for partial
summary judgment of dismissal should be granted and the First
Claim For Relief should be dismissed. The Plaintiff’s motion
for partial summary judgment should be denied.
Respectfully submitted,
TIFFORD & TIFFORD, P.A.
Lead counsel for Universal,
Altomare and Gunderson
1385 N.W. 15th Street
Miami, FL 33125
(305) 545-7822
FAX: (305) 325-1825
BY /S/
ARTHUR W. TIFFORD
(NY ID- 011481)
CERTIFICATE OF SERVICE
I hereby certify that on March 8, 2007, I electronically
filed the foregoing with the Clerk of the Court by using the
CM/ECF System, which will send notice of electronic filing to
the following:
22
Julie K. Lutz, Esq.
Attorney for Plaintiff
U.S. Securities and Exchange Commission
Central Regional Office
1801 California Street, Suite 4800
Denver, CO 80202-2648
Robert B. Blackburn, Esq.
Attorney for Plaintiff
U.S. Securities and Exchange Commission
233 Broadway, 11th Floor
New York, NY 10279
Marvin Pickholz, Esq.
Jason Pickholz, Esq.
Akerman Senterfitt LLP
335 Madison Avenue
Suite 2600
New York, NY 10017
John B. Harris, Esq.
Stillman & Friedman
425 Park Avenue
New York, NY 10022
Harry H. Wise, III, Esq.
770 Lexington Avenue, 6th Floor
New York, NY 10021
John A. Hutchings, Esq.
Dill Dill Carr Stonebraker & Hutchings, P.C.
455 Sherman Street, Suite 300
Denver, CO 80203
/S/
ARTHUR W. TIFFORD
23
Click Links Below For Easy Navigation:
1. Supreme Court Case
2. 150 Articles: SEC finally admits Naked Short Selling is a HUGE problem and a cause for financial crisis (July 15th, 2008 et. seq-September 15th, 2008 et. seq)
3. Richard Altomare's "Prison Inc." Book Excerpts
4. Universal Express Statement
5. Universal Express Recitation of Facts by General Counsel
6. Brief in Support of USXP Entitlement to Trial by Jury
7. Universal Express Complaint filed against SEC- March 3, 2004
8. USXP Full Page Ad in New York Times
9. Office of Inspector General Semi Annual Report to Congress- March 31, 2008
10. Richard Altomare's Speech on Naked Short Selling
11. USXP Quarterly and Annual Reports
12. Exhibit A and B: Universal Express Press Releases and Published Articles on Naked Short Selling 1998-2007
13. Universal Express Motion for Partial Summary Judgment
14. Supplemental Declaration of Chris G. Gunderson- Nov 13, 2006
15. Universal Express et al Motion for Reconsideration- March 8th, 2007
16. USXP Memo of Law in Support of Motion for Reconsideration
17. Universal's Declaration of General Counsel in Response to SEC's Request for a Receiver
