Judge Dismisses Agora Suit Aiming To Prevent SEC Probe
By Carol S. Remond
Of DOW JONES NEWSWIRES
NEW YORK (Dow Jones)--A federal judge Monday dismissed a lawsuit filed by newsletter publisher Agora Inc. against the Securities and Exchange Commission in an attempt to prevent an SEC investigation.
The suit, filed in September in the U.S. District Court for the District of Maryland, claimed that an investigation opened by the SEC into Agora and one of its newsletters was in violation of the publisher's First Amendment rights.
Agora was asking the court to block the SEC from proceeding with its investigation.
The dismissal of Agora's suit comes just one week after the SEC filed a complaint against Agora, alleging the publisher and one of its subsidiaries called Pirate Investor LLC engaged in a scheme to defraud investors by disseminating false information in several Internet newsletters.
According to the SEC complaint, in May Agora and Pirate offered to sell false inside information about a USEC Inc. (USU) to newsletter subscribers for a fee of $1,000.
The SEC said that Agora made more than $1 million from the sale of false information to its newsletter subscribers. The SEC is seeking to have Agora and Pirate disgorge all ill-gotten gains and is looking to impose civil monetary penalties on the defendants.
Agora is a Baltimore newsletter group founded by James Dale Davidson. Although it doesn't name Davidson as a defendant, the SEC said in its complaint that Davidson, who is also editor of Agora's Vantage Point Investment Advisory, promoted companies in his newsletter, including GeneMax Corp. (GMXX) and Endovasc Ltd. (EVSC), without disclosing his relationships to the companies.
The SEC said in its complaint against Agora and Pirate that the
defendants'"conduct occurred in connection with the purchase and sale of securities of public companies."
The SEC also said that Agora continued to engage in "ongoing efforts to disseminate false information to the investing public" even after the publisher became aware of the commission's investigation.
By Carol S. Remond, Dow Jones Newswires; 201-938- 2074;
carol.remond@dowjones.com
(END) Dow Jones Newswires
23-04-03 1245GMT
