The opinion
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8 UNITED STATES DISTRICT COURT
9 CENTRAL DISTRICT OF CALIFORNIA
10 Western Division
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12 SECURITIES AND EXCHANGE Case No. 2:23-cv-00403 CAS(AFMx)
COMMISSION,
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Plaintiff, FINAL JUDGMENT AS TO
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DEFENDANT JOHN MARK
15 vs. MARINO
16 JOHN MARK MARINO, JASON
“JAI” JOHNSON, ABRAHAM
17 BORENSTEIN, AND ANTHONY
BROWN,
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Defendants.
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21 This matter came before the Court on the Plaintiff Securities and Exchange
22 Commission’s (“SEC”) Application for Default Judgment against Defendant John
23 Mark Marino (“Defendant”). The Court finds that entry of default judgment is
24 appropriate, having considered the SEC’s Complaint, Application for Default
25 Judgment, supporting declaration, and the other evidence and argument presented to
26 the Court, and having considered the applicable legal requirements, including Fed. R.
27 Civ. P. 55, Local Rule 55-1, and the factors listed in Eitel v. McCool, 782 F.2d 1470,
1 the merits of plaintiff’s substantive claim, (3) the sufficiency of the complaint, (4) the
2 sum of money at stake in the action, (5) the possibility of a dispute concerning
3 material facts, (6) whether the default was due to excusable neglect, and (7) the
4 strong policy underlying the Federal Rules of Civil Procedure favoring decisions on
5 the merits. Accordingly, the Court enters judgments as follows:
6 I.
7 IT IS HEREBY ORDERED that the SEC’s Application for Default Judgment
8 against Defendant is GRANTED.
9 II.
10 IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that Defendant is
11 permanently restrained and enjoined from violating, directly or indirectly, Section
12 10(b) of the Securities Exchange Act of 1934 (the “Exchange Act”) [15 U.S.C. §
13 78j(b)] and Rule 10b-5 promulgated thereunder [17 C.F.R. § 240.10b-5], by using
14 any means or instrumentality of interstate commerce, or of the mails, or of any
15 facility of any national securities exchange, in connection with the purchase or sale of
16 any security:
17 (a) to employ any device, scheme, or artifice to defraud;
18 (b) to make any untrue statement of a material fact or to omit to state a material
19 fact necessary in order to make the statements made, in the light of the circumstances
20 under which they were made, not misleading; or
21 (c) to engage in any act, practice, or course of business which operates or
22 would operate as a fraud or deceit upon any person.
23 IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, as
24 provided in Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also
25 binds the following who receive actual notice of this Final Judgment by personal
26 service or otherwise: (a) Defendant’s officers, agents, servants, employees, and
27 attorneys; and (b) other persons in active concert or participation with Defendant or
1 III.
2 IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that Defendant is
3 permanently restrained and enjoined from violating Section 17(a) of the Securities
4 Act of 1933 (the “Securities Act”) [15 U.S.C. § 77q(a)] in the offer or sale of any
5 security by the use of any means or instruments of transportation or communication
6 in interstate commerce or by use of the mails, directly or indirectly:
7 (a) to employ any device, scheme, or artifice to defraud;
8 (b) to obtain money or property by means of any untrue statement of a material
9 fact or any omission of a material fact necessary in order to make the statements
10 made, in light of the circumstances under which they were made, not misleading; or
11 (c) to engage in any transaction, practice, or course of business which operates
12 or would operate as a fraud or deceit upon the purchaser.
13 IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, as
14 provided in Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also
15 binds the following who receive actual notice of this Final Judgment by personal
16 service or otherwise: (a) Defendant’s officers, agents, servants, employees, and
17 attorneys; and (b) other persons in active concert or participation with Defendant or
18 with anyone described in (a).
19 IV.
20 IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that pursuant to
21 Section 21(d)(5) of the Exchange Act [15 U.S.C. § 78u(d)(5)], Defendant is
22 permanently restrained and enjoined from directly or indirectly, including but not
23 limited to, through any entity owned or controlled by him, participating in the
24 issuance, purchase, offer, or sale of any security in an unregistered offering, provided,
25 however, that such injunction shall not prevent him from purchasing or selling
26 securities for his own personal account.
27 IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, as
1 binds the following who receive actual notice of this Final Judgment by personal
2 service or otherwise: (a) Defendant’s officers, agents, servants, employees, and
3 attorneys; and (b) other persons in active concert or participation with Defendant or
4 with anyone described in (a).
5 V.
6 IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that, pursuant to
7 Section 21(d)(2) of the Exchange Act [15 U.S.C. § 78u(d)(2)] and Section 20(e) of
8 the Securities Act [15 U.S.C. § 77t(e)], Defendant is prohibited from acting as an
9 officer or director of any issuer that has a class of securities registered pursuant to
10 Section 12 of the Exchange Act [15 U.S.C. § 78l] or that is required to file reports
11 pursuant to Section 15(d) of the Exchange Act [15 U.S.C. § 78o(d)].
12 VI.
13 IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that
14 Defendant is liable for disgorgement of $65,700, representing net profits gained as a
15 result of the conduct alleged in the Complaint, together with prejudgment interest
16 thereon in the amount of $21,396.52, and a civil penalty in the amount of $236,451
17 pursuant to Section 20(d) of the Securities Act [15 U.S.C. § 77t(d)] and Section
18 21(d)(3) of the Exchange Act [15 U.S.C. § 78u(d)(3)]. Defendant shall satisfy this
19 obligation by paying $323,547.52 to the Securities and Exchange Commission within
20 30 days after entry of this Final Judgment.
21 Defendant may transmit payment electronically to the Commission, which will
22 provide detailed ACH transfer/Fedwire instructions upon request. Payment may also
23 be made directly from a bank account via Pay.gov through the SEC website at
24 http://www.sec.gov/about/offices/ofm.htm. Defendant may also pay by certified
25 check, bank cashier’s check, or United States postal money order payable to the
26 Securities and Exchange Commission, which shall be delivered or mailed to
27 Enterprise Services Center
1 6500 South MacArthur Boulevard
2 Oklahoma City, OK 73169
3 and shall be accompanied by a letter identifying the case title, civil action number,
4 and name of this Court; John Mark Marino as a defendant in this action; and
5 specifying that payment is made pursuant to this Final Judgment.
6 Defendant shall simultaneously transmit photocopies of evidence of payment
7 and case identifying information to the Commission’s counsel in this action. By
8 making this payment, Defendant relinquishes all legal and equitable right, title, and
9 interest in such funds and no part of the funds shall be returned to Defendant.
10 The Commission may enforce the Court’s judgment for disgorgement and
11 prejudgment interest by using all collection procedures authorized by law, including,
12 but not limited to, moving for civil contempt at any time after 30 days following entry
13 of this Final Judgment.
14 The Commission may enforce the Court’s judgment for penalties by the use of
15 all collection procedures authorized by law, including the Federal Debt Collection
16 Procedures Act, 28 U.S.C. § 3001 et seq., and moving for civil contempt for the
17 violation of any Court orders issued in this action. Defendant shall pay post judgment
18 interest on any amounts due after 30 days of the entry of this Final Judgment pursuant
19 to 28 U.S.C. § 1961. The Commission shall hold the funds, together with any interest
20 and income earned thereon (collectively, the “Fund”), pending further order of the
21 Court.
22 The Commission may propose a plan to distribute the Fund subject to the
23 Court’s approval. Such a plan may provide that the Fund shall be distributed pursuant
24 to the Fair Fund provisions of Section 308(a) of the Sarbanes-Oxley Act of 2002. The
25 Court shall retain jurisdiction over the administration of any distribution of the Fund
26 and the Fund may only be disbursed pursuant to an Order of the Court.
27 Regardless of whether any such Fair Fund distribution is made, amounts
1 || penalties paid to the government for all purposes, including all tax purposes. To
2 || preserve the deterrent effect of the civil penalty, Defendant shall not, after offset or
3 ||reduction of any award of compensatory damages in any Related Investor Action
4 based on Defendant’s payment of disgorgement in this action, argue that he is entitled
5 || to, nor shall he further benefit by, offset or reduction of such compensatory damages
6 || award by the amount of any part of Defendant’s payment of a civil penalty in this
7 action (“Penalty Offset’). If the court in any Related Investor Action grants such a
8 || Penalty Offset, Defendant shall, within 30 days after entry of a final order granting
9 Penalty Offset, notify the Commission’s counsel in this action and pay the amount
10 || of the Penalty Offset to the United States Treasury or to a Fair Fund, as the
11 |}Commission directs. Such a payment shall not be deemed an additional civil penalty
12 shall not be deemed to change the amount of the civil penalty imposed in this
13 || Judgment. For purposes of this paragraph, a “Related Investor Action” means a
14 || private damages action brought against Defendant by or on behalf of one or more
15 |/investors based on substantially the same facts as alleged in the Complaint in this
16 || action.
17 VII.
18 IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that this Court
19 retain jurisdiction of this matter for the purposes of enforcing the terms of this
20 || Final Judgment.
21 VII.
22 There being no just reason for delay, pursuant to Rule 54(b) of the Federal
23 || Rules of Civil Procedure, the Clerk is ordered to enter this Final Judgment forthwith
24 || and without further notice.
25 || Dated: August 26, 2025 hana 2 bright
UNITED STATES DISTRICT JUDGE
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