Nutra Pharma Corporation, et al.
U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 26088 / August 30, 2024
Securities and Exchange Commission v. Nutra Pharma Corp. et al No. 2:18-cv-5459 (E.D.N.Y filed Sept. 28, 2018)
SEC Obtains Final Judgment Against Florida Microcap Issuer
On August 28, 2024, the U.S. District Court for the Eastern District of New York entered a final consent judgment against microcap issuer Nutra Pharma Corporation, enjoining it from violating certain provisions of the federal securities laws and ordering disgorgement and civil monetary penalties.
According to the SEC’s complaint, Nutra Pharma, a microcap issuer that purports to make pain relief drugs with cobra venom, issued or posted a series of press releases that materially misled investors. The releases allegedly implied, among other things, that Nutra Pharma had engaged a company to distribute its product internationally, when it had not, and that Nutra Pharma had expanded and upgraded its cobra farm facilities, when it did not own those facilities or the cobras, and there were no expansions or upgrades at that time. As alleged in the SEC’s complaint, Nutra Pharma publicized many of these press releases while engaged in an unregistered distribution of its securities to retail investors. In addition, Nutra Pharma allegedly failed to make numerous required filings, including ones about the company’s sales of unregistered securities.
The SEC’s complaint charged Nutra Pharma with violating Sections 5(a) and (c) and 17(a) of the Securities Act of 1933 and Sections 10(b) and 13(a) of the Securities Exchange Act of 1934 and Rules 10b-5, 13a-11, and 13a-13 thereunder.
On August 31, 2022, the court granted the Commission summary judgment on its claims that Nutra Pharma violated Sections 5(a) and 5(c) of the Securities Act and Section 13(a) of the Exchange Act and Rule 13a-11 thereunder. On March 19, 2024, the Court entered a partial consent judgment against Nutra Pharma in which it agreed, without admitting or denying the allegations, to be permanently enjoined from violations of the charged provisions.
On August 28, 2024, the Court entered a final consent judgment against Nutra Pharma in which it was ordered to pay $520,940 in disgorgement and $59,295.05 in prejudgment interest thereon, as well as $100,000 in civil penalties.
The SEC’s litigation was conducted by Rusty Feldman, Karolina Klyuchnikova, Lee Greenwood, and Lindsay S. Moilanen of the New York Regional Office and was supervised by Daniel Loss and Sheldon L. Pollock.