U. S. SECURITIES AND EXCHANGE COMMISSION
PACIFIC REGIONAL OFFICE
LOS ANGELES, CALIFORNIA
Litigation Release No. 15716 / April 22, 1998
SECURITIES AND EXCHANGE COMMISSION V. MICHAEL W. CROW, ET
AL., Civil Action No. 96-1661 S CM (S.D. Cal.)
On April 20, 1998, the Honorable Edward J. Schwartz, United
States District Judge for the Southern District of
California entered a judgment of permanent injunction and
other relief against Michael W. Crow ("Crow"). The judgment
permanently enjoins Crow from violating the insider trading,
antifraud, reporting, recordkeeping, internal control, and
lying to an auditor provisions of the securities laws. Crow
was the former president and board chairman of Wilshire
Technologies, Inc. ("Wilshire"), a public company located in
Carlsbad, California. [SEC v. Michael W. Crow and Peter F.
Kuebler, Civil Action No. 96-1661 S CM, S.D. Cal.] (LR-
15144)
Crow consented to the entry of judgment permanently
enjoining him from future violations of Section 17(a) of the
Securities Act of 1933 and Sections 10(b), 13(a),
13(b)(2)(A) and 13(b)(2)(B) of the Securities Exchange Act
of 1934 and Rules 10b-5, 12b-20, 13a-13, 13b2-1 and 13b2-2
thereunder; ordering him to pay disgorgement of $1,248,444
plus prejudgment interest of $225,773, with the judgment to
be satisfied by the resolution of a related securities class
action lawsuit; and barring him from serving as an officer
or director of a reporting company. Crow consented to the
relief without admitting or denying the allegations set
forth in the Commission's first amended complaint, filed on
November 1, 1996. The Commission's amended complaint
alleged that Crow violated the federal securities laws by
causing Wilshire to overstate its earnings, to issue
materially misleading press releases and to file materially
misleading periodic financial reports with the Commission.
The Commission alleged in its amended complaint that Crow
caused Wilshire to overstate its fiscal 1993 second and
third quarter financial statements by causing Wilshire to
recognize revenue on conditional sales of two new and
untested products. One product, the TrimPatch, was designed
as an over-the-counter appetite suppressant administered
through the skin. The other product, a pipe plug, was
designed to clean tubing in clean rooms in manufacturing
facilities. The Commission further alleged that Crow caused
SNIPPETS:
U. S. SECURITIES AND EXCHANGE COMMISSION
Civil Action No. 96-1661 S CM (S.D.
California entered a judgment of permanent injunction and
other relief against Michael W. Crow.
The judgment
lying to an auditor provisions of the securities laws.
was the former president and board chairman of Wilshire
Crow consented to the entry of judgment permanently
thereunder; ordering him to pay disgorgement of $1,248,444
or director of a reporting company.
The Commission's amended complaint
causing Wilshire to overstate its earnings,
misleading periodic financial reports with the Commission.
third quarter financial statements by causing Wilshire to
recognize revenue on conditional sales of two new and
designed to clean tubing in clean rooms in manufacturing
Wilshire to overstate its earnings by causing Wilshire to
Crow violated the antifraud provision of Section
10of the Securities Exchange Act of 1934 ("Exchange
Section 13of the Exchange Act and Rules 12b-20 and 13a13 thereunder, the recordkeeping
Wilshire's financial statements.
admitting or denying the findings therein.
Crow's willful violations of the securities laws and denies
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