UNI TEDSTATESDI STRI CTCOURT EASTERNDI STRI CTOFLOUI SI ANA SECURI TI ESANDEXCHANGE COMMI SSI ON CI VI LACTI ON VERSUS NO: 15- 2451 RONALDL. BLACKBURN, ETALSECTI ON: J ( 1) ORDER & REASONS Bef or et heCour t i saRule 56 Motion for Summary Judgment (Rec. Doc. 74) f i l edbyDef endant sRonal dLeeBl ackbur n, Andr ew V. Rei d, Br uceGwyn, andMi chael A. Mul shi ne( Def endant s) and anopposi t i ont her et o( Rec. Doc. 82) f i l edbyPl ai nt i f f , t he Secur i t i esandExchangeCommi ssi on. Havi ngconsi der edt hemot i on andl egal memor anda, t her ecor d, andt heappl i cabl el aw, t he Cour t f i ndst hat t hemot i onshoul dbeDENIED.FACTS AND PROCEDURAL BACKGROUND OnDecember 15, 2014, t heSecur i t i esandExchange Commi ssi on( SEC) f i l edaCompl ai nt agai nst Def endant sf orvar i ouscl ai msunder t heSecur i t i esAct of 1933andt he Secur i t i esExchangeAct of 1934. TheCompl ai nt al l egesa wi despr eadschemebyt hei ndi vi dual Def endant st odef r aud i nvest or sandvi ol at et heant i f r aud, r egi st r at i on, andr epor t i ng pr ovi si onsof t hef eder al secur i t i esl awswi t hr espect t o Def endant Tr eat yEner gyCor por at i on, apubl i cl yt r adedoi l and gascompany. Accor di ngt ot heSEC, Def endant sBl ackbur n, Rei d,Case 2:15-cv-02451-CJB-SS Document 86 Filed 08/12/15 Page 1 of 10 2 Gwyn, Mul shi ne, Schl esi nger , andWhi t l eycar r i edout t hi sscheme bet ween2009and2013by( 1) conceal i ngt hat Bl ackbur n, a convi ct edf el on, cont r ol l edTr eat yasdefactoof f i cer and di r ect or ; ( 2) engagi ngi naf al sepr omot i onal campai gni nt ended t oar t i f i ci al l yi nf l at eTr eat y sst ockpr i ce, i ncl udi ngi ssui ng aJ anuar y2012pr essr el easef al sel ycl ai mi ngamaj or oi l st r i ke i nBel i ze; ( 3) per pet uat i ngaf r audul ent t r adi ngscheme i nvol vi ngt hei ssuanceandt r ansf er of r est r i ct edand unr est r i ct edTr eat yst ockt hr oughwhi chDef endant sr ai sed mi l l i onsof dol l ar ssel l i ngvi r t ual l ywor t hl essst ockt o unwi t t i ngi nvest or s; and( 4) conduct i ngani l l egal and unr egi st er edof f er i ngof oi l andgaswor ki ngi nt er est s. The Compl ai nt al l egest hat asar esul t of t hei r mi sconduct ,Def endant sr eapedi l l i ci t pr of i t sof over $4. 9mi l l i on.OnJ une30, 2105, t hi scasewast r ansf er r edt ot hi sCour tf r omt heEast er nDi st r i ct of Texasaf t er Def endant s, al l but one of whom r esi dei nt heEast er nDi st r i ct of Loui si ana, movedt o t r ansf er venue. Def endant sf i l edt hei nst ant Rule 56 Motion for Summary Judgment(Rec. Doc. 74)onJ ul y28, 2015.PARTIES ARGUMENTS I nsuppor t of t hei r mot i onf or summar yj udgment , Def endant s ar guet hat t heSEC scl ai m i snot about vi ol at i onsof t he Secur i t i esAct or t heSecur i t i esExchangeAct , but r at her [ i ] ti sabout t heabuseof t heSEC si nvest i gat i vef unct i onsandt he Case 2:15-cv-02451-CJB-SS Document 86 Filed 08/12/15 Page 2 of 10 3 f ai l ur eof t heSECt odi sassoci at ei t sel f f r om per sonswhower e knowi ngl yabusi ngi t spr ocess, namel yagr oupof peopl e r ef er r edt obyDef endant sastdbowkieknife bloggersor Tr eat y mal cont ent s. ( Rec. Doc. 74- 1, p. 1) Al t houghDef endant smove f or summar yj udgment , t heyspendappr oxi mat el yei ght pagesoft hei r memor andum ar gui ngt hat t heCour t shoul dst r i kevar i ous par agr aphsandcapt i onsi nt heSECCompl ai nt pur suant t oFeder alRul eof Ci vi l Pr ocedur e12( f ) , becauset heyar ei mmat er i al ,i mper t i nent , andscandal ous. ( Rec. Doc. 74- 1, pp. 10- 18) The r emai nder of Def endant s memor andum ar guest hat t heCompl ai ntwoef ul l yf ai l st het est f or speci f i ci t yunder Rul e9( b) , t hatt heal l egat i onsar enot hi ngmor et hanapar r ot i ngof sl ander , andt hat t heSECst af f at t or neywhoi ni t i at edt hi smat t ersubj ect edt heDef endant st ohumi l i at i oni nvi ol at i onof Rul eofEvi dence404aswel l ast her ul esof l i f e. ( Rec. Doc. 74- 1, p.21)Thesubst anceof Def endant s ar gument i nsuppor t of t hei rmot i onf or summar yj udgment begi nsont hel ast pageof t hei rmemor andum, af t er not i ngt hat t heywi l l not bel abor t hei ssue. Def endant saddr esst heSEC scl ai msi nt hr eepar agr aphs, each essent i al l yr est at i ngt hecl ai m andendi ngsi mpl ywi t ht he phr aseThat di dnot happen. ( Rec. Doc. 74- 1, p. 25)Rat her t hanr espondwi t hevi denceof speci f i cf act s cr eat i ngagenui nei ssuef or t r i al , t heSECar guesi nopposi t i on Case 2:15-cv-02451-CJB-SS Document 86 Filed 08/12/15 Page 3 of 10 4 t hat Def endant sf ai l edt omeet t hei r bur denasmovant sbecause t heymer el ydenyt hat t heal l egedvi ol at i onoccur r ed. ( Rec. Doc.82, p. 4) Fur t her mor e, t heSECaskst heCour t t odi sr egar dal lunci t edal l egat i onscont ai nedi nDef endant s br i ef andt he accompanyi ng St at ement of Uncont est edFact s, whi char enotsuppor t edbyasi ngl eci t at i ont ot heevi dence. ( Rec. Doc. 82,p. 2)LEGAL STANDARD Summar yj udgment i sappr opr i at ewhent hepl eadi ngs, t he di scover yanddi scl osur emat er i al sonf i l e, andanyaf f i davi t s showt hat t her ei snogenui nei ssueast oanymat er i al f act and t hat t hemovant i sent i t l edt oj udgment asamat t er of l aw. Celotex Corp. v. Catrett, 477U. S. 317, 322( 1986) ( ci t i ngFed.R. Ci v. P. 56( c) ) ; Littlev.LiquidAirCorp., 37F. 3d1069,1075( 5t hCi r . 1994) . Whenassessi ngwhet her adi sput east oany mat er i al f act exi st s, t heCour t consi der sal l of t heevi dence i nt her ecor dbut r ef r ai nsf r om maki ngcr edi bi l i t y det er mi nat i onsor wei ghi ngt heevi dence. Delta & Pine Land Co. v. Nationwide Agribusiness Ins. Co., 530F. 3d395, 398( 5t hCi r .2008) . Al l r easonabl ei nf er encesar edr awni nf avor of t he nonmovi ngpar t y, but apar t ycannot def eat summar yj udgment wi t h concl usor yal l egat i onsor unsubst ant i at edasser t i ons. Little, 37 F. 3dat 1075. Acour t ul t i mat el ymust besat i sf i edt hat a Case 2:15-cv-02451-CJB-SS Document 86 Filed 08/12/15 Page 4 of 10 5 r easonabl ej ur ycoul dnot r et ur naver di ct f or t henonmovi ng par t y. Delta, 530F. 3dat 399.I f t hedi sposi t i vei ssuei soneonwhi cht hemovi ngpar t y wi l l bear t hebur denof pr oof at t r i al , t hemovi ngpar t ymustcomef or war dwi t hevi dencewhi chwoul d ent i t l ei t t oadi r ect ed ver di ct i f t heevi dencewent uncont r over t edat t r i al . Intl Shortstop,Inc.v.Rallys,Inc., 939F. 2d1257, 1263- 64( 5t h Ci r . 1991) ( ci t at i onomi t t ed) . Thenonmovi ngpar t ycant hen def eat t hemot i onbyei t her count er i ngwi t hsuf f i ci ent evi dence of i t sown, or showi ngt hat t hemovi ngpar t y sevi dencei sso sheer t hat i t maynot per suadet her easonabl ef act - f i nder t o r et ur naver di ct i nf avor of t hemovi ngpar t y. Id. at 1265.I f t hedi sposi t i vei ssuei soneonwhi cht henonmovi ng par t ywi l l bear t hebur denof pr oof at t r i al , t hemovi ngpar t y must demonst r at et heabsenceof agenui nei ssueof mat er i alf act , but neednot negatet heel ement sof t henonmovant ' s case. Little, 37F. 3dat 1075( quot i ngCelotex, 477U. S. at323) . I f t hemovi ngpar t yf ai l st omeet t hi si ni t i al bur den,t hemot i onmust bedeni ed, r egar dl essof t henonmovant ' s r esponse. I f t hemovant does, however , meet t hi sbur den, t he nonmovant must gobeyondt hepl eadi ngsanddesi gnat especi f i c f act sshowi ngt hat t her ei sagenui nei ssuef or t r i al . Id.The nonmovant sbur deni snot sat i sf i edwi t hsomemet aphysi caldoubt ast ot hemat er i al f act s, byconcl usor yal l egat i ons, by Case 2:15-cv-02451-CJB-SS Document 86 Filed 08/12/15 Page 5 of 10 6 unsubst ant i at edasser t i ons, or byonl yasci nt i l l aof evi dence. Id.( ci t at i onsomi t t ed) ( i nt er nal quot at i onmar ksomi t t ed) .DISCUSSION TheCour t must f i r st det er mi newhet her Def endant shave sat i sf i edt hei r i ni t i al bur den. Si mpl yf i l i ngamot i onf orsummar yj udgment doesnot i mmedi at el ycompel t hepar t yopposi ng t hemot i ont ocomef or war dwi t hevi dencedemonst r at i ngmat er i ali ssuesof f act ast oever yel ement of i t scase. Russv.Int'l PaperCo., 943F. 2d589, 591( 5t hCi r . 1991) . Celotexmakes cl ear t hat bef or et henonmovi ngpar t yi sr equi r edt opr oduce evi dencei nopposi t i ont ot hemot i on, t hemovi ngpar t ymustf i r st sat i sf yi t sobl i gat i onof demonst r at i ngt hat t her ear eno f act ual i ssueswar r ant i ngt r i al . Russ, 943F. 2dat 592.Of cour se, apar t yseeki ngsummar yj udgment al ways bear st hei ni t i al r esponsi bi l i t yof i nf or mi ngt he di st r i ct cour t of t hebasi sf or i t smot i on, and i dent i f yi ngt hosepor t i onsof t hepl eadi ngs,deposi t i ons, answer st oi nt er r ogat or i es, and admi ssi onsonf i l e, t oget her wi t ht heaf f i davi t s, i fany, whi chi t bel i evesdemonst r at et heabsenceof a genui nei ssueof mat er i al f act . Id.( quot i ngCelotex, 477U. S. at 323) . Thi si ni t i al bur den r emai nswi t ht hemovi ngpar t yevenwhent hei ssuei nvol vedi s oneonwhi cht henon- movant wi l l bear t hebur denof pr oof att r i al . Id. Thus, t hemovant must di schar get hebur dent heRul es pl aceuponhi m: I t i snot enought omovef or summar yj udgmentwi t hout suppor t i ngt hemot i oni nanywayor wi t haconcl usor y Case 2:15-cv-02451-CJB-SS Document 86 Filed 08/12/15 Page 6 of 10 7 asser t i ont hat t hepl ai nt i f f hasnoevi dencet opr ovehi scase. Celotex, 477U. S. at 328( Whi t e, J . , concur r i ng) ; see alsoAshe v. Corley, 992F. 2d540, 543( 5t hCi r . 1993) .Rul e56( c) set sout t hepr ocedur esf or suppor t i ngf act ualposi t i onsi namot i onf or summar yj udgment . Apar t yasser t i ng t hat af act cannot begenui nel ydi sput edmust suppor t t he asser t i onby: ( A) ci t i ngt opar t i cul ar par t sof mat er i al si nt he r ecor d[ ; or ] ( B) showi ngt hat t hemat er i al sci t eddonotest abl i sht he. . . pr esenceof agenui nedi sput e, or t hat an adver separ t ycannot pr oduceadmi ssi bl eevi dencet osuppor t t he f act . Fed. R. Ci v. P. 56( c) . Al t hought hecour t mayconsi derot her mat er i al si nt her ecor d, i t needonl yconsi der t heci t ed mat er i al s. Id. I nt hei nst ant case, Def endant sci t et osi xexhi bi t s at t achedt ot hei r mot i onf or summar yj udgment : apet i t i onf ordamagesf i l edi nSt . TammanyPar i shagai nst Bl ackbur n, Tr eat y,andf our ot her def endant s( Rec. Doc. 74- 3) ; anemai l chai n bet weenanSECst af f at t or neyandt woI mmi gr at i onandCust oms Enf or cement agent s( Rec. Doc. 74- 4) ; var i ouscomment spost edon anonl i nebl ogr ef er r edt oasI nvest or HUB( Rec. Docs. 74- 5, 74-6, 74- 7) ; andanemai l chai nbet weent heDef endant s at t or ney andt heSECst af f at t or ney( Rec. Doc. 74- 8) . Def endant sal so quot emul t i pl epar agr aphsof t heSECCompl ai nt , mai nl yseeki ng t ohavet hesepor t i onsst r i cken. ( Rec. Doc. 74- 1, pp. 10- 18)Case 2:15-cv-02451-CJB-SS Document 86 Filed 08/12/15 Page 7 of 10 8 Noneof t heDef endant s Uncont est edMat er i al Fact sar e suppor t edbyci t at i ont ot her ecor dor anyot her mat er i al s.( Rec. Doc. 74- 2)I naddi t i on, Def endant sci t eSECv.Wheeling-Pittsburgh Steel Corp., aWest er nDi st r i ct of Pennsyl vani acasevacat edby t heUni t edSt at esCour t of Appeal sf or t heThi r dCi r cui t , f ort hepr oposi t i ont hat t he[ SEC] owesadut yt ot hepubl i c. . .t odi sassoci at ei t sel f f r om per sonswhoar eknowi ngl yabusi ng i t spr ocess. 482F. Supp. 555, 565( W. D. Pa. 1979) . I n Wheeling-Pittsburgh, t hedi st r i ct cour t r ef usedt oenf or cea subpoenaducestecumbecausei t bel i evedt hat t heSEChad al l owedbi asedt hi r dpar t i est oi nf l uencet hei nvest i gat i ve pr ocessi mpr oper l y. Id.at 566. Onappeal , t heThi r dCi r cui tr emandedt hecasebecausei t wasuncl ear f r omt hedi st r i ct cour topi ni onwhet her i t f ocusedont hemot i vesof t heSEC, whi chi s t hepr oper f ocusi nachal l enget oanadmi ni st r at i vesubpoena,or whet her t hemot i vesof t hi r dpar t i eswer er el i edupon. SEC v. Wheeling-PittsburghSteelCorp., 648F. 2d118, 128( 3dCi r .1981) . However , Def endant s r el i anceont hedi st r i ct cour t s vacat edopi ni oni nWheeling-Pittsburghi smi spl aced; i t pr ovi des nosuppor t f or t heasser t i ont hat t her ei snogenui nei ssueas t oanymat er i al f act andt hat t hemovant i sent i t l edt oj udgmentasamat t er of l aw.Case 2:15-cv-02451-CJB-SS Document 86 Filed 08/12/15 Page 8 of 10 9 Rat her t hansuppor t t hei r mot i onf or summar yj udgment ,Def endant sdevot easubst ant i al por t i onof t hei r br i ef t oa det ai l eddi scussi onof t heneedt opur get hecompl ai nt , i n whi chDef endant saskt heCour t t ost r i kecer t ai nal l egat i ons under Rul e12( f ) . Amot i onf or summar yj udgment i st heent i r el y i mpr oper vehi cl ei nwhi cht or ai set hi si ssue. Accor di ngl y, t he Cour t wi l l not consi der t hi sar gument .I t i sappar ent t hat Def endant st ot al l yf ai l edt osat i sf y t hemovant sbur denasset out i nRul e56, Celotex, andRuss.TheDef endant s mot i onf or summar yj udgment f ai l edt opoi nt outanabsenceof pr oof onanyf act ual i ssue. Si mi l ar t ot hemot i on bef or et hecour t i nAshe v. Corley, t hemot i onf ai l edt or ai se anyf act ual i ssuesat al l , ot her t hani nt hemost concl usor y t er ms. 992F. 2dat 544. Amer econcl usor yst at ement t hat t he al l egat i onsi nt heCompl ai nt di dnot happendoesnot sat i sf y t hemovant sbur den. Asar esul t , t hebur dennever shi f t edt o t heSECt ogobeyondt hepl eadi ngst oshowspeci f i cf act s cr eat i ngagenui nei ssuef or t r i al ,1andt heCour t must denyt he mot i on.CONCLUSION Accor di ngl y,

1 I t shoul dbenot ed, however , t hat t heSECt r ul ywal kedt her azor ' sedgewi t h t hei r r esponset ot he[ Def endant s ] mot i on. Ashe, 992F. 2dat 544n. 5. I ft heDef endant s hadsat i sf i edt hei r bur denwi t hr espect t oanyessent i alel ement of t heSEC scl ai ms, t heSEC sr esponsewoul dhavebeencompl et el y i nadequat et opr event summar yj udgment . Seeid. Case 2:15-cv-02451-CJB-SS Document 86 Filed 08/12/15 Page 9 of 10 10 ITISHEREBYORDEREDt hat Def endant s Rule56Motionfor Summary Judgment(Rec. Doc. 74)i sDENIED.NewOr l eans, Loui si anat hi s12t hdayof August , 2015. CARLJ . BARBI ER UNI TEDSTATESDI STRI CTJ UDGE Case 2:15-cv-02451-CJB-SS Document 86 Filed 08/12/15 Page 10 of 10