Joseph M. Salvani & JFS Investments, Inc. vs. Investorshub.com,
Inc., et al.
United States District Court, Southern District of New York
Case No. 1:13-CV-07082-ER
Summary: Salvani sued iHub after refusing his request to remove third-party
Dismissed on 9/23/2014.
Salvani's original complaint lacked a cause of action sufficient to invoke federal
jurisdiction. When this fatal flaw was pointed out by iHub's counsel, Salvani's
lawyer, Douglas R. Dollinger, filed an amended complaint followed by a second amended
complaint which added some contrived securities law claims in an attempt to invoke
federal jurisdiction. iHub moved to dismiss the lawsuit for lack of subject matter
jurisdiction on the basis that the federal claims were not colorable and merely
an attempt to masquerade a state-law tort (defamation) case as a federal case.
In reaching its opinion finding in favor of iHub, rather than treating the federal
claims as not colorable and dismissing for lack of subject matter jurisdiction under
Rule 12(b)(1), the Court dismissed Salvani's federal claims on the merits under
Rule 12(b)(6) for effectively the same rationale, finding that Salvani failed to
state a claim for which relief could be granted. The remaining state-law tort claims
were also dismissed. Since all of Salvani's claims were dismissed, the Court did
not need to reach to the matter of iHub's immunity from liability under the Communications
United States Court of Appeals, Second Circuit
Case No.: 14-3994
On 10/23/2014 Salvani filed a Notice of Appeal, despite the absurdity
of his claims and the pending court cases (described below) brought by the U.S.
Department of Justice and U.S. Securities & Exchange Commission against multiple
individuals in connection with alleged trading manipulation of CodeSmart Holdings
- 12/09/2014 Appeal dismissed for failure to pay appeal fee. Reinstated on 12/15/2014.
- 12/30/2014 Appeal dismissed for failure to file Notice of Appearance Form by
Salvani's lawyer. Reinstated on 1/07/2015.
- 02/17/2015 Salvani filed Appellant's Brief
- 05/08/2015 iHub filed Appellee's Brief
- 09/29/2015 The appeal panel for the 2nd Circuit heard the case on the
submitted record without oral argument.
- 10/09/2015 Opinion
of the Second Circuit Court of Appeals
- 11/05/2015 Mandate Issued
- 10/23/2015 iHub files Bill of Costs
- 11/12/2015 iHub files Motion for Legal Fees
Outcome: On October 9, 2015, the United States Court of Appeals for the Second Circuit
affirmed the decision in favor of InvestorsHub.
The underlying basis of Salvani's contrived federal claim was, effectively, that
an allegedly defamatory
on the InvestorsHub CodeSmart Holdings message board by an anonymous user, in combination
with "inflammatory" titles of entirely unrelated message boards somehow caused a
massive sell-off in the shares of CodeSmart Holdings Inc. (ITEN) and constituted
violations of the Exchange Act. Several months after iHub filed its motion to dismiss
which debunked Salvani's novel theories, the U.S. Securities and Exchange Commission
and U.S. Attorney for the Eastern District of New York each made public their own
theories as to what had occurred with regard to the manipulation and trading of
- SEC Charges Self-Described Bankers, Dishonest
Brokers, and Microcap Company Executive in Pump-And-Dump Scheme
- U.S. Attorney: Corporate Executives, Registered Brokers, and an Attorney Indicted
for Orchestrating a $300 Million Market Manipulation Scheme Involving Four Publicly
It should be noted that Mr. Salvani self-described certain aspects of his relationship
with CodeSmart in his pleadings to the iHub Court. He was not named or charged in
either the SEC complaint or the DOJ criminal indictment. The SEC's press release
states that their investigation "is continuing."
On 09/18/2014, investigative reporter Teri Buhl published this article about the ongoing government investigation and charges, followed
by this update on 11/07/2015.
Media, Academia and Other Jurisprudence