SEC Motion regarding Summary Judgement
9/21/2010
"Plaintiff, the Securities and Exchange Commission, files the recent order issued in SEC v.
Mozilo, et al., 09-3994-JFW (C.D. Ca. Sept. 16, 2010). Exh. A. This decision is relevant to
defendants’ motion for summary judgment with respect to whether GlobeTel Communications
Corp.’s misstatements of revenue were material.
In Mozilo, the court held that in an enforcement action, the Commission need not prove
reliance and, therefore, the “fraud on the market” presumption is not relevant. Id., Slip Op. at 10-
11. This decision supports the Commission’s argument that whether GlobeTel’s stock price
moved up or down in response to GlobeTel’s misstatements is not relevant to whether the
misstatements were material since the movement of a company’s stock price only applies to a
private securities action in which the plaintiff relies upon the “fraud on the market” presumption
to prove reliance"
“Justice is the firm and continuous desire to render to everyone that which is his due”
