Reply in Support of M. Perry’s Motion for Partial Summary Judgment: SEC’s Risk Weighting and 17(a)(2) Claims

Excerpts from M. Perry’s Reply:

“The SEC once again tries to muddy the water on summary judgment by overwhelming the Court with dozens of extraneous exhibits and extensively arguing a point —materiality— that is not even raised by Mr. Perry’s motion. Contrary to the SEC’s assertion, the question before the Court on the risk-weighting issue is not materiality. It is rather whether IndyMac’s May 12, 2008 SEC filings were false or misleading. The SEC has failed to come forward with any evidence that they were. Because the SEC cannot meet its threshold burden of presenting evidence that the May 12 filings were false or misleading, Mr. Perry is entitled to summary judgment on the SEC’s risk-weighting claim. The Court need not reach the separate and secondary issue of materiality.”

“IndyMac had no duty to disclose in its SEC filings a capital ratio that unquestionably was not the operative one for the OTS for purposes of determining whether the Bank was well capitalized. The absence of that information did not render anything IndyMac said in its May 12, 2008 SEC filings false or misleading. Accordingly, it cannot be the basis for a fraudulent omission claim.”

“The SEC also cannot withstand summary judgment on its section 17(a)(2) claim. While the SEC dwells on the general requirement that there be an offer or sale of securities to support section 17(a) liability, the SEC cannot dispute that subsection 17(a)(2) of section 17(a) contains an additional, independent element: subsection 17(a)(2), by its terms, applies only if the defendant “obtain(ed) money or property” by means of a false statement or fraudulent omission. The SEC presents no evidence that Mr. Perry or IndyMac obtained money or property by means of any alleged false statements or fraudulent omissions in the May 12 filings here. That the SEC is forced to rely on the fact that IndyMac’s DSPP administrator, Mellon Bank, briefly held money on account from DSPP bidders after May 12, 2008 before refunding it to the bidders underscores the baselessness of the SEC’s section 17(a)(2) claim.”

“In sum, the issues raised by Mr. Perry’s motion for partial summary judgment are simple and straightforward. The SEC has failed to meet its burden of establishing any genuine factual disputes concerning them. Accordingly, Mr. Perry’s motion should be granted.”

Click Here to Access M. Perry’s Entire Reply

N. Maskay’s Declaration in Support of M. Perry’s Motion

Excerpts from Deposition of C. Hunt-Fuhr’s Deposition

Excerpt from OTS Handbook

OTS Fact Sheet on IndyMac Bank

Posted on July 2, 2012, in Postings. Bookmark the permalink. Leave a comment.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: