U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 15704 / April 13, 1998 SECURITIES AND EXCHANGE COMMISSION v. B.M.C. ENTERPRISES, INC., ET AL., Civil Action No. 97-4811 CAS (JGx) (C.D. Cal.). The Securities and Exchange Commission announced that on April 2, 1998, the Honorable Christina A. Snyder, United States District Judge for the Central District of California, entered Judgments of Permanent Injunction against nine individual defendants. Four of the defendants -- Michael E. Lopuszynski, C. Scott Courtney, Jonathan Shoucair, and Michael W. Engelhardt -- consented, without admitting or denying the allegations, to be enjoined from future violations of the antifraud, securities registration, and broker-dealer registration provisions of the federal securities laws (Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933 and Sections 10(b) and 15(a) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder). Five of the defendants -- Joseph Widmer, Kent Bollenbach, Timothy Grayson, Brent Morris, and James Perez -- consented, without admitting or denying the allegations, to be enjoined from future violations of the securities registration and broker-dealer registration provisions (Sections 5(a) and 5(c) of the Securities Act of 1933 and Section 15(a) of the Securities Exchange Act of 1934). The Court retained jurisdiction over this action for purposes of determining the amount of disgorgement and/or civil penalties to be paid by these individuals. Litigation is still pending against the other defendants named in the Commission's action. On July 2, 1997, the Commission filed its complaint in federal district court in Los Angeles alleging fraud in the offer and sale of units in Touch Tone Partners ("Touch Tone"), a California partnership based in Canoga Park, California. Touch Tone purportedly was going to establish and operate a 900-number dating service. The Commission's complaint alleged that the defendants raised approximately $3.9 million from investors nationwide from the sale of the Touch Tone securities from August 1994 through January 1995. The complaint alleged that neither the Touch Tone securities nor any of the sales offices selling the securities were registered with the Commission. The complaint further alleged that Lopuszynski, Courtney, Shoucair, Engelhardt, and their salespeople made material misrepresentations to potential investors about the use of the Touch Tone offering proceeds and other aspects of this investment. For additional information, see Litigation Release 15400 (July 2, 1997).