Release No. 7724 / August 16, 1999

Release No. 41744 / August 16, 1999

File No. 3-9201

In the Matter of

Sky Scientific, Inc.; W.A. Dorow, Jr.;
Jerry L. Foster; Gilbert Marshall & Co., Inc.;
Michael A. Usher; Strategic Resource
Management, Inc.; William A. Moler; Daniel
R. Lehl; Thomas Patrick Meehan; Douglas A.
Glaser; Smith, Benton & Hughes, Inc.; Michael
Zaman; George T. Hellen; Robert Schlien;
American Capital Network, Inc.; Philip M.
Georgeson; Melvin L. Levine; William David Jones



In these proceedings ordered pursuant to Section 8A of the Securities Act of 1933 ("Securities Act") and Sections 15(b), 19(h) and 21C of the Securities Exchange Act of 1934 ("Exchange Act"), 1 Respondents Michael A. Usher ("Usher") and Gilbert Marshall & Co., Inc. ("Gilbert Marshall") have submitted an Offer of Settlement ("Offer") which the Securities and Exchange Commission has determined to accept. Solely for the purpose of these proceedings and any other proceedings brought by or on behalf of the Commission or in which the Commission is a party, Usher and Gilbert Marshall consent to the entry of this Order of the Commission Making Findings and Imposing Remedial Sanctions and Cease-and-Desist Order and admit the jurisdiction of the Commission with respect to the matters set forth in this Order.


On the basis of Usher's and Gilbert Marshall's Offer, the Commission finds 2that:

A. The Initial Decision of the Administrative Law Judge issued March 5, 1999 ("Initial Decision"), shall become the final order of the Commission except as set forth below in paragraphs II. E. and III. A.

B. As found in the Initial Decision, Usher was the president of Gilbert Marshall, a broker dealer registered with the Commission. As set forth in more detail in the Initial Decision, from March 1994 through November 1994 a branch office of Gilbert Marshall sold $5.4 million of Sky Scientific Inc. ("Sky") stock to retail customers in 862 transactions. That branch office employed high pressure fraudulent sales practices to sell Sky stock. Usher, without performing appropriate investigation, authorized that branch office to sell Sky stock to the public and thereby furthered the fraudulent sale of Sky stock to the public.

C. As set forth in more detail in the Initial Decision, from March 24, 1994 through July 31, 1994 Gilbert Marshall in 338 transactions, sold Sky common stock to customers of Gilbert Marshall at excessive undisclosed markups. As a result of these excessive markups Gilbert Marshall realized excessive trading profits of $211,947. In making these sales of stock, Gilbert Marshall was not a market maker for purposes of calculating markups because it did not make a two sided market in which it regularly both bought and sold Sky stock in the inter-dealer market. Yet it calculated its markups based on inter-dealer quotes rather than its contemporaneous cost of acquisition.

D. As found in the Initial Decision, and as set forth in paragraphs II. B. and II. C. Usher and Gilbert Marshall willfully violated Section 10(b) of the Exchange Act and Rule 10b-5 thereunder and Sections 5(a), 5(c), and 17(a)(1), (a)(2), and (a)(3) of the Securities Act of 1933.

E. It is appropriate in this matter for Usher and Gilbert Marshall to pay disgorgement and Usher to pay a civil penalty. Respondents have submitted sworn financial statements and other evidence and has asserted their financial inability to pay disgorgement of more than $10,000 or a civil penalty. The Commission has reviewed the sworn financial statements and other evidence provided by Respondents and has determined that Respondents do not have the financial ability to pay disgorgement of more than $10,000 or a civil penalty.


In view of the foregoing, the Commission finds that it is in the public interest to impose sanctions specified in the Offer of Settlement.

Accordingly, IT IS ORDERED that:

A. Usher is barred from association with any broker-dealer.

B. The broker dealer registration of Gilbert Marshall is revoked.

C. Usher and Gilbert Marshall shall cease and desist from committing or causing any violations and future violations of Sections 5(a), 5(c), and 17(a) of the Securities Act and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder.

D. Joint and several disgorgement by Usher and Gilbert Marshall is fixed in the amount of $5,435,183 plus prejudgment interest, but the payment of such amount except for $10,000 shall be waived based upon Respondents' demonstrated financial inability to pay. The Division of Enforcement ("Division") may, at any time following the entry of this Order, petition the Commission to: 1) reopen this matter to consider whether Respondent provided accurate and complete financial information at the time such representations were made, and if not; 2) determine the amount of civil penalty to be imposed; 3) determine the amount of prejudgment interest to order; and 4) seek any additional remedies that the Commission would be authorized to impose in this proceeding if Respondent's offer of settlement had not been accepted. No other issues shall be considered in connection with this petition other than whether the financial information provided by Respondent was fraudulent, misleading, inaccurate or incomplete in any material respect, the amount of civil penalty to be imposed and whether any additional remedies should be imposed. Respondent may not, by way of defense to any such petition, contest the findings in this Order or the Commission's authority to impose any additional remedies that were available in the original proceeding.

E. Respondents shall, no later than October 15, 1999 pay disgorgement in the amount of $10,000 to the United States Treasury. Such payment shall be: (A) made by United States postal money order, certified check, bank cashier's check or bank money order; (B) made payable to the Securities and Exchange Commission; (C) hand delivered or mailed to the Comptroller, Securities and Exchange Commission, Operations Center, 6432 General Green Way, Stop 0-3, Alexandria, Virginia, 22312; and (D) submitted under cover letter that identifies Usher and Gilbert Marshall as respondents in these proceedings, the file number of these proceedings, a copy of which cover letter and money order or check shall be sent to Robert Fusfeld, Securities and Exchange Commission, 1801 California Street, Suite 4800, Denver, Colorado 80202.

By the Commission.

Jonathan G. Katz



The Order for Public Proceeding in this matter was issued on December 16, 1996.

The findings herein are made pursuant to Respondents' Offer of Settlement and are not binding on any other person or entity in this or any other proceeding.