UNITED STATES SECURITIES AND EXCHANGE COMMISSION
LITIGATION RELEASE NO. 16772 / October 18, 2000
SECURITIES AND EXCHANGE COMMISSION V. BROADBAND WIRELESS INTERNATIONAL CORPORATION, BROADCOM WIRELESS COMMUNICATIONS CORPORATION, IVAN W. WEBB and DONALD L. KNIGHT, Defendants; and BLACK GIANT RESOURCES CORPORATION, BROADBAND WIRELESS COMMUNICATIONS CORPORATION, MEDSCAN TECHNOLOGIES, INC., and KIMBERLY KNIGHT, Relief-Defendants. Civil Action No. CVI 00-1375-R (USDC/W.D. Okl)
The Securities and Exchange Commission (SEC or Commission) announced that, on October 16, 2000, Chief Judge David Russell of the U.S. District Court for the Western District of Oklahoma in Oklahoma City entered preliminary injunctions against BroadBand Wireless International Corporation (BBAN), BroadCom Wireless Communications Corporation (BroadCom), Donald L. Knight and Ivan W. Webb in the referenced civil action. The Commission's complaint in this case alleges that Knight and Webb orchestrated a "pump and dump" scheme involving BBAN stock, through false and misleading press releases, SEC filings and postings on the "Raging Bull" Internet message board, which drove up the price of BBAN stock by more than 10,000%. Before the price fell back to its prior level, Knight, using additional misrepresentations, sold or "dumped" millions of shares of restricted BBAN stock he held in the name of BroadCom to investors, reaping at least $5 million. Knight and Webb participated in a false and misleading S-8 registration. Knight further devised a fraudulent proxy solicitation.
Each party is preliminarily enjoined from violations of Sections 5(a), 5(c) and 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 (Exchange Act) and Rule 10b-5 thereunder. BBAN and Webb are also enjoined from violations of Section 13(a) of the Exchange Act, and Rules 13a-11, 13a-13 and 12b-20 thereunder. BroadCom and Knight are also enjoined from violations of Sections 13(d) and 14(a) of the Exchange Act, and Rules 13d-1, 13d-2, 14a-3, 14a-6 and 14a-9 thereunder. In addition, each party is subject to an asset freeze. BBAN, BroadCom and Webb agreed to the entry of the injunctions.