UNITED STATES DISTRICT COURT
for the
DISTRICT OF MASSACHUSETTS

SECURITIES AND EXCHANGE COMMISSION'S APPLICATION FOR AN ORDER TO SHOW CAUSE AND AN ORDER REQUIRING GARY C. HALBERT, BOND HALBERT, CHERRYWOOD PUBLISHING, INC., AND JOHN DOE TO COMPLY WITH ADMINISTRATIVE SUBPOENAS

The United States Securities and Exchange Commission ("Commission") respectfully applies to this Court for: (i) an Order to Show Cause why Respondents Gary C. Halbert, Bond Halbert, Cherrywood Publishing, Inc., and John Doe (a/k/a "Keeper of Records") (collectively, "Respondents") should not comply with the Commission's administrative subpoenas for documents and testimony; (ii) an Order compelling Respondents to produce to the Commission's Boston District Office all documents responsive to the Commission's subpoenas dated August 12, 2003 and August 20, 2003, served upon them by the Commission staff, and (iii) an Order compelling Respondents Gary C. Halbert, Bond Halbert, and John Doe to testify in the Commission's Boston District Office pursuant to the Commission's subpoenas dated August 12, 2003 and August 20, 2003, served upon them by the Commission staff.

SUMMARY

This matter arises out of the Respondents' failure to comply with administrative subpoenas for documents and testimony that were lawfully and properly issued by the Commission. As part of its formal investigation concerning possible material false statements made by Cherrywood Publishing, Inc.1 ("Cherrywood") and others, on August 12, 2003, an authorized member of the Commission staff issued administrative subpoenas to Gary C. Halbert, Bond Halbert, Cherrywood, and Cherrywood's Keeper of Records requiring that (i) the Respondents produce documents relevant to the Commission's investigation, and (ii) Gary C. Halbert, Bond Halbert, and Cherrywood's Keeper of Records testify regarding matters relevant to the investigation. In addition, on August 20, 2003, an authorized member of the Commission staff issued a second administrative subpoena to Bond Halbert, at a different address, requiring that he produce documents and testify regarding matters relevant to the investigation.

To date, Respondents have produced no documents in response to the subpoenas. In addition, neither Gary C. Halbert, Bond Halbert nor the Keeper of Records have appeared for testimony, as compelled by their subpoenas. Counsel for Gary C. Halbert and Cherrywood has advised the staff that Gary C. Halbert recently left the country for an unspecified time period and, as a result, her clients are unavailable to produce documents or testify. However, counsel has failed to provide requested documentation or specific information regarding Gary C. Halbert's whereabouts or his expected date of return from overseas.

The Respondents' failure to produce documents and appear for testimony are impeding and delaying a properly authorized investigation into possible violations of the federal securities laws. Accordingly, the Commission respectfully requests that this Court order the Respondents to produce all documents responsive to the subpoenas and appear for their investigative testimony. In particular, the Commission requests that this Court issue: (i) an Order to Show Cause why Respondents should not comply with the Commission's administrative subpoenas for documents and testimony; (ii) an Order compelling Respondents to produce to the Commission's Boston District Office all documents responsive to the Commission's subpoenas dated August 12, 2003 and August 20, 2003, served upon them by the Commission staff, and (iii) an Order compelling Respondents Gary C. Halbert, Bond Halbert, and John Doe to testify in the Commission's Boston District Office pursuant to the Commission's subpoenas dated August 12, 2003 and August 20, 2003, served upon them by the Commission staff.

FACTS

On August 12, 2003 the Commission issued a formal order of private investigation entitled In the Matter of Cherrywood Publishing, Inc., File No. B-01967 ("Formal Order"), pursuant to Sections 21(a) and Section 21(b) of the Securities Exchange Act of 1934 ("Exchange Act") and Section 209(a) of the Investment Advisers Act of 1940 ("Advisers Act"). The Formal Order directed certain Commission staff members to undertake a private investigation to determine if there were violations of the federal securities laws, including violations of the antifraud, reporting, and books and records provisions of the Exchange Act and the Advisers Act. See Declaration of Gary T. Grassey in Support of the Securities and Exchange Commission's Application for an Order to Show Cause and an Order Requiring Gary C. Halbert, Bond Halbert,Cherrywood Publishing, Inc., and John Doe to Comply with Administrative Subpoenas ("Grassey Declaration"), ¶¶11-12.

I. Nature of the Investigation

Pursuant to the Formal Order, the staff of the Boston District Office is investigating possible material false and misleading performance statements made by or on behalf of Cherrywood and Gary C. Halbert regarding a stock trading system in newspaper advertisements that appeared in USA Today and on an Internet website, www.thegaryhalbertletter.com ("Halbert Website"), which is purportedly operated by Gary C. Halbert. See Grassey Declaration, ¶¶ 5-6. The advertisement that appeared in USA Today contains various performance claims about a proprietary stock trading system purportedly developed by Gary C. Halbert. Id. Among other things, the advertisement asserts that through Gary C. Halbert's stock trading system, an investor "can make several hundred or several thousand dollars the first 4 minutes the market is open . . . with almost ZERO RISK." See Grassey Declaration, ¶ 6 (emphasis in original). Prospective investors are invited to contact Gary C. Halbert via a toll-free telephone number and, in turn, receive a free book about the trading system. Id. According to the advertisement, at one point, Gary C. Halbert made "76 consecutive winning trades in the futures markets [which] caused the bankruptcy of a major Commodity and Futures brokerage."2 Id.

Gary C. Halbert also purports to be the author of numerous letters on the Halbert Website, including a letter that describes his stock trading system. See Grassey Declaration, ¶¶ 5 and 7. On the Website, much like the USA Today advertisement, Gary C. Halbert makes performance claims about his stock trading system, including: (i) "After I'm done schooling you, you could make three to thirty trades a day and easily average $1,000.00 per trade"; and (ii) "I've never yet had a single losing trade." See Grassey Declaration, ¶ 7. Moreover, on the Website, in exchange for a fee of $3,700, Gary C. Halbert offers to personally teach his clients the secrets underlying his proprietary trading system via personal telephone consultations. Id. Gary C. Halbert further promises that his clients will make "live profitable trades right there while [he] is on the phone with [them.]" Id.

II. The Commission Staff's Requests and Subpoenas for Documents and Testimony

A. The Voluntary Request

Prior to the issuance of the Formal Order, the Commission staff requested, by letter dated June 6, 2003 ("Voluntary Request"), that Gary C. Halbert and Cherrywood produce documents on a voluntary basis by June 13, 2003. See Grassey Declaration, ¶ 5. The Voluntary Request included a request that Gary C. Halbert and Cherrywood take steps to preserve any responsive documents. Id. On June 17, 2003, four days after the deadline had passed, Bond Halbert, Gary C. Halbert's son, contacted the Commission staff by telephone and requested that the staff send a copy of the Voluntary Request to him via facsimile; the staff complied with his request. See Grassey Declaration, ¶ 8. During that telephone conversation, Bond Halbert also stated that he would provide the Voluntary Request to his father. Id. Further, Bond Halbert stated that the address to which the Voluntary Request had been sent was correct. Id.

On June 26, 2003, counsel for Gary C. Halbert wrote to the staff and stated that she represents Cherrywood and the Offices of Gary C. Halbert in connection with the investigation. See Grassey Declaration, ¶ 9. Subsequently, on July 8, 2003, counsel for Gary C. Halbert contacted the staff regarding the Voluntary Request. See Grassey Declaration, ¶ 10. During that conversation, the staff conveyed a request to counsel that Gary C. Halbert immediately comply with the Voluntary Request and, in addition, provide voluntary testimony concerning the subject matter of the Voluntary Request. Id. Later that day, in a separate conversation, counsel told the staff that she had advised Gary C. Halbert not to comply with either the staff's Voluntary Request for testimony or documents. Id. In addition, counsel told the staff that if her client was ultimately compelled to testify, she would advise him to assert his Fifth Amendment privilege against self-incrimination. Id.

B. The Subpoenas

On August 12, 2003, the staff contacted Gary C. Halbert's counsel by telephone and advised her that the Commission had issued a Formal Order. See Grassey Declaration, ¶¶ 11-12. Later that day, counsel stated that she would not accept service of any subpoenas on behalf of her clients, including Gary C. Halbert and any of his business enterprises. See Grassey Declaration, ¶ 12. She also stated that she does not represent Bond Halbert. Id. By certified mail and overnight courier dated August 12, 2003, the staff then served subpoenas upon Gary C. Halbert, Bond Halbert, Cherrywood,3 and John Doe. Id. The return date for the document productions compelled by the August 12th subpoenas was August 20th, 2003. Id. As to testimony compelled by the August 12th subpoenas, Bond Halbert and John Doe were compelled to appear at the Commission's Boston District Office on September 3, 2003; Gary C. Halbert's subpoenacompelled his testimony on September 4, 2003 in Boston. Id.

On August 18, 2003, counsel for Gary C. Halbert telephoned the staff and stated that, according to Gary C. Halbert's secretary, her client was out of the country to undergo a medical procedure. See Grassey Declaration, ¶ 14. At that time, counsel requested an extension of 30 to 45 days for her clients to comply with the subpoenas. Id. Counsel also stated that Cherrywood was no longer in business and that she did not know how to reach Bond Halbert. Id. In response, the staff told counsel that while an accommodation might be reached as to the date of testimony, compliance with the document subpoena was required -- particularly because a number of the document requests were straightforward (e.g., the book that is the subject of the USA Today advertisements) and could be satisfied by Gary C. Halbert's secretary. Id. The staff also reminded counsel that the definition of "Cherrywood" in the subpoenas included other entities, supra at note 1. See Grassey Declaration, ¶¶ 5, 14. Despite the staff's request for additional details regarding Gary C. Halbert's absence, counsel did not provide documentation or specific information regarding Gary C. Halbert's whereabouts or his expected date of return from overseas. See Grassey Declaration, ¶ 14. The staff also requested, by letter dated August 21, 2003 to counsel, information regarding Gary C. Halbert and John Doe's whereabouts and documents. See Grassey Declaration, ¶ 17.

On August 19, 2003, the Commission staff called Gary C. Halbert's counsel to inquire whether her clients would be producing the documents responsive to the three Commission subpoenas that were due on August 20, 2003. See Grassey Declaration, ¶ 15. She told the staff that she did not believe that the documents would be produced the next day because she was unable to speak with Gary C. Halbert. Id. In fact, no documents were produced by any of theRespondents on August 20, 2003 or at any time thereafter. See Grassey Declaration, ¶¶ 17-18.

On August 20, 2003, Bond Halbert did not produce documents responsive to his August 12th subpoena. See Grassey Declaration, ¶ 17. Further, on August 20, 2003, the staff issued a second subpoena to Bond Halbert at a different address by certified mail and overnight courier, which compelled him to produce documents on September 3, 2003 and to testify at the Boston District Office on September 10, 2003. See Grassey Declaration, ¶ 16.

Next, the staff, by letter dated August 21, 2003 to Gary C. Halbert's counsel, reiterated its request that Gary C. Halbert, John Doe, and Cherrywood comply with the subpoenas, produce responsive documents and testify. See Grassey Declaration, ¶ 17. On August 29, 2003, the Commission staff called Gary C. Halbert's counsel to determine whether Gary C. Halbert and John Doe would testify in response to the two Commission subpoenas, as required, on September 3 and 4, 2003. See Grassey Declaration, ¶ 18. She advised the staff that she did not believe either Gary C. Halbert or John Doe would appear for testimony and also stated that she had been unable to speak with either Gary C. Halbert or his secretary. Id. In fact, neither Gary C. Halbert nor John Doe appeared for testimony, as required, on those dates at the Boston District Office. Likewise, Bond Halbert did not appear for testimony, as required, on September 3, 2003.

Finally, by letters dated September 11, 2003, the staff reiterated its position regarding Gary C. Halbert, Cherrywood, and John Doe's respective failures to comply with their subpoenas in letters to each (with copies to counsel). See Grassey Declaration, ¶ 19. Similarly, the staff advised Bond Halbert, by two letters dated September 11, 2003, that he was not in compliance with the August 12th and August 20th subpoenas. See Grassey Declaration, ¶ 20. Those letters provided Gary C. Halbert, Bond Halbert, Cherrywood, and John Doe with a deadline ofSeptember 15, 2003 by which to comply with the subpoenas or otherwise communicate with the staff. See Grassey Declaration, ¶¶ 19-20. In response, none of the Respondents have contacted the staff. See Grassey Declaration, ¶ 21. Moreover, none of the Respondents have produced documents or testified in response to the Commission's subpoenas. See Grassey Declaration, ¶¶ 19-21. No meritorious explanation has been offered for their respective failures to comply with the Commission's subpoenas. See Grassey Declaration, ¶ 21.

The staff requires the documents and testimony that Respondents have failed to produce in response to their subpoenas to (i) evaluate the statements made by Gary C. Halbert and Cherrywood in their advertisements and on their website, and (ii) determine whether Respondents have violated the antifraud provisions of the Exchange Act and the Advisers Act. See Grassey Declaration, ¶ 22.

ARGUMENT

A. The Federal Securities Laws Authorize this Court to Enforce Commission Subpoenas upon Application by the Commission

Section 21(c) of the Exchange Act, 15 U.S.C. § 78u(c), and Section 209(a) of the Advisers Act, 15 U.S.C. § 78u(c) authorize this Court to order enforcement of the Commission's subpoenas upon application of the Commission. Pursuant to the Exchange Act provisions, in the case of a refusal to obey a Commission subpoena by any person, the Commission "may invoke the aid of any court of the United States within the jurisdiction of which such investigation or proceeding is carried on. . . ." 15 U.S.C. § 78u(c); see also 15 U.S.C. §§ 806-9(c) (authorizing federal courts to enforce Commission subpoenas pursuant to the Advisers Act). Courts in this district have utilized the show cause practice in subpoena enforcement proceedings filed by the Commission's Boston District Office. See, e.g., SEC v. Calvin, MBD No. 02-10132-WGY (D.Mass. June 6, 2002); SEC v. Timson, MBD No. 02-10076-RCL (D. Mass. March 15, 2002); SEC v. DiBella, MBD No. 00-10235-NG (D. Mass. July 7, 2000); SEC v. Cottrill, MBD No. 99-10096-EFH (D. Mass. March 5, 1999); SEC v. Blizzard, MBD No. 97-10222-MLW (D. Mass. April 23, 1997).

Additionally, this subpoena enforcement action may properly be filed in the District of Massachusetts. The enabling statute provides that the Commission may file an application in any district court "within the jurisdiction of which such investigation or proceeding is carried on, or where such person resides or carries on business." 15 U.S.C. § 78u(c). See FTC v. MacArthur, 532 F.2d 1135, 1139-41(7th Cir. 1976) (discussing comparable venue provision for Federal Trade Commission petition for order requiring compliance with subpoena duces tecum). See also FEC v. Committee To Elect Lyndon La Rouche, 613 F.2d 849, 853-58 (D.C. Cir. 1979), cert. denied, 444 U.S. 1074 (1980) (discussing comparable venue provision for enforcing Federal Election Commission subpoena and holding that the "hub of investigative activity" was proper jurisdiction for enforcing subpoena). Here the Commission's investigation in which Respondents were subpoenaed is being conducted by the Boston District Office staff and the subpoenas at issue were returnable in Boston. Accordingly, this application is properly before this Court.

B. The Commission's Subpoenas Satisfy All Applicable Requirements

To enforce an administrative subpoena, a court must be satisfied that: (1) the inquiry is being conducted for a proper purpose; (2) the subpoena was issued in accordance with the required administrative procedures; and (3) the information sought is relevant to that legitimate purpose. United States v. Powell, 379 U.S. 48, 57-58 (1964); SEC v. Howatt, 525 F.2d 226, 229 (1st Cir. 1975); SEC v. Murray Director Affiliates, Inc., 426 F. Supp. 684, 686 (S.D.N.Y. 1976).

Once the Commission meets these criteria, the opposing party bears the burden of establishing that the agency's purpose was unlawful or its subpoena unreasonable. United States v. Powell, 379 U.S. at 58 (unlawful purpose); SEC v. Arthur Young & Co., 584 F.2d 1018, 1034 n.139 (D.C. Cir. 1978), cert. denied, 439 U.S. 1071 (1979) (unreasonable burden); see also Howatt, 525 F.2d at 229 (court's role in enforcing subpoena is to ensure that process is not abused and agency is not acting in bad faith). When the Commission's inquiry is authorized and the information sought is relevant to the inquiry, the opponent's burden of showing unreasonableness "is not easily met." SEC v. Brigadoon Scotch Dist. Co., 480 F.2d 1047, 1056 (2d Cir. 1973), cert. denied, 415 U.S. 915 (1974). Here, the Commission's subpoenas satisfy all applicable standards.

1. The Commission's Inquiry is for a Proper Purpose

The Commission is authorized by Section 21(a) of the Exchange Act to exercise its discretion to conduct investigations to determine whether any person "has violated, is violating, or is about to violate" any provisions of the Exchange Act or the rules or regulations promulgated thereunder. 15 U.S.C. § 78u(a). Section 21(a) of the Advisers Act provides the Commission with like authority to investigate potential violations of that statute. See 15 U.S.C. §§ 806-9(a). This investigation is being conducted pursuant to the August 12, 2003 Formal Order, issued by the Commission pursuant to Section 21(a) of the Exchange Act and Section 209(a) of the Advisers Act. Accordingly, this investigation is lawful and falls within the scope of authority that Congress granted to the Commission. See SEC v. Dresser Industries, Inc., 628 F.2d 1368, 1376 (D.C. Cir.), cert. denied, 449 U.S. 993 (1980) (recognizing scope of Commission's authority under Section 21(a) of the Exchange Act); SEC v. Wall Street Transcript Corp., 454 F.Supp. 559, 661 (S.D.N.Y. 1978)(recognizing scope of Commission's authority under Section 209(a) of the Advisers Act).4

2. The Commission Has Satisfied All Administrative Requirements

The subpoenas at issue satisfy all applicable administrative requirements. Pursuant to Section 21(b) of the Exchange Act, 15 U.S.C. § 78u(b) and Section 209(b) of the Advisers Act, 15 U.S.C. §§ 806-9(b), officers designated by the Commission are empowered to subpoena witnesses and require the production of relevant evidence. Gary T. Grassey, senior counsel at the Boston District Office, who issued the subpoenas to the Respondent, is specifically empowered by the Formal Order with authority to subpoena witnesses and documents for the Commission's investigation as to whether there have been violations of the federal securities laws.

In addition, pursuant to Rule 8 of the Commission's Rules Relating to Investigations, and Rule 14(b)(3) of the Rules of Practice, investigative subpoenas may be served by several methods, including in person and by express delivery service. 17 C.F.R. §§ 203.8, 201.232(c), 201.150(c). The August 12, 2003 subpoenas were served on Respondents at Cherrywood's place of business via overnight delivery and via certified mail (return receipt requested). The August 20, 2003 subpoena was served on Bond Halbert at a second address via overnight delivery andvia certified mail (return receipt requested). Accordingly, the subpoenas were issued properly, by an authorized officer of the Commission, and were served in compliance with applicable administrative procedures.

3. The Commission Is Seeking Relevant Information

For purposes of subpoena enforcement, relevance is established when the information sought is not "plainly incompetent or irrelevant for any lawful purpose." Arthur Young & Co., 584 F.2d at 1029 (citing Endicott Johnson Corp. v. Perkins, 317 U.S. 501, 509 (1943)). The Arthur Young court held that "the test is relevance to the specific purpose, and the purpose is determined by the investigators." 584 F.2d at 1031.

Here, the information sought by the Commission is relevant to the Commission's ongoing investigation of potential securities law violations. The Commission seeks to learn, among other things, the basis for certain statements in advertisements and a website published by or on behalf of Gary C. Halbert and Cherrywood and whether those statements were false and misleading in connection with (i) the purchase and sale of a security, or (ii) an investment advisory business. The documents and testimony requested by the subpoenas are directly relevant to those issues.

C. Respondents Have Failed to Provide Meritorious Reasons For Their Failures to Comply with Properly Issued Administrative Subpoenas

More than a month has elapsed since the issuance of the August 12, 2003 subpoenas and none of the Respondents have produced any documents or appeared for testimony.5 In addition,counsel for Gary C. Halbert has refused to provide requested information regarding his whereabouts. Moreover, Bond Halbert has not responded at all to either his subpoenas or to the staff's September 11, 2003 letter, which discussed his noncompliance with the subpoenas.

D. The Commission's Application Should Be Granted Expeditiously

Because of the need for expeditious action, the law clearly provides that subpoena enforcement proceedings generally are summary in nature. SEC v. Sprecher, 594 F.2d 317, 319-320 (2d Cir. 1979); SEC v. First Security Bank of Utah, N.A., 447 F.2d 166, 168 (10th Cir. 1971), cert. denied sub nom. Nemelka v. SEC, 404 U.S. 1038 (1972). As the Court of Appeals for the Second Circuit stated in United States v. Davey:

[W]e take this occasion to stress again the desirability of expediting resolution of any question concerning the validity of subpoenas and the production of evidence in the district court as well as on the appellate level. These matters should be given precedence over other business . . . .

426 F.2d 842, 845 (2d Cir. 1970) (discussing IRS summons).

The Respondents' failure to produce the subpoenaed documents and testify already has delayed the staff's investigation of this matter significantly. The documents and testimony are critical to the completion of the investigation. Accordingly, the Commission, by the undersigned counsel, respectfully requests this Court to act expeditiously to grant this Application and the requested relief.

CONCLUSION

For the reasons stated above, the Commission requests that its Application be granted in all respects and that this Court enter: (i) an Order to Show Cause why Respondents should notcomply with the Commission's administrative subpoenas for documents and testimony, (ii) an Order compelling Respondents to produce to the Commission's Boston District Office all documents responsive to the Commission's subpoenas dated August 12, 2003 and August 20, 2003, served upon them by the Commission staff, and (iii) an Order compelling Respondents Gary C. Halbert, Bond Halbert, and John Doe to testify in the Commission's Boston District Office pursuant to the Commission's subpoenas dated August 12, 2003 and August 20, 2003, served upon them by the Commission staff.

CERTIFICATE OF SERVICE

I hereby certify that on September __, 2003, I caused a copy of:

1. Securities and Exchange Commission's Application for an Order to Show Cause and an Order Requiring Gary C. Halbert, Bond Halbert, Cherrywood Publishing, Inc., and JohnDoe to Comply with Administrative Subpoenas;

2. Declaration of Gary T. Grassey in Support of Securities and Exchange Commission's Application for an Order to Show Cause and an Order Requiring Gary C. Halbert, Bond Halbert, Cherrywood Publishing, Inc., and John Doe to Comply with Administrative Subpoenas;

3. [Proposed] Order Requiring Gary C. Halbert to Show Cause;

4. [Proposed] Order Requiring Bond Halbert to Show Cause;

5. [Proposed] Order Requiring Cherrywood Publishing, Inc. to Show Cause;

6. [Proposed] Order Requiring John Doe to Show Cause;

7. [Proposed] Order Requiring Gary C. Halbert to Comply with Administrative Subpoena;

8. [Proposed] Order Requiring Cherrywood Publishing, Inc. to Comply with Administrative Subpoena;

9. [Proposed] Order Requiring Bond Halbert to Comply with Administrative Subpoenas; and

10. [Proposed] Order Requiring John Doe to Comply with Administrative Subpoena.

to be sent via certified mail (return receipt requested) and facsimile to the following addresses:

Gary C. Halbert
Suite 905-467
3101 S.W. 34th Avenue
Ocala, FL 34474-7447
Fax: (305) 861-1665

Cherrywood Publishing, Inc.
Suite 905-467
3101 S.W. 34th Avenue
Ocala, FL 34474-7447
Fax: (305) 861-1665

Keeper of Records
c/o Cherrywood Publishing, Inc.
Suite 905-467
3101 S.W. 34th Avenue
Ocala, FL 34474-7447
Fax: (305) 861-1665

Bond Halbert
Suite 905-467
3101 S.W. 34th Avenue
Ocala, FL 34474-7447
Fax: (323) 512-5122

Bond Halbert
7510 West Sunset Boulevard
Los Angeles, CA 90046-3408
Fax: (323) 512-5122

Susan, Noe, Esq.
Attorney at Law
1440 Kennedy Causeway, Suite 321
North Bay Village, FL 33141
Fax: (305) 867-8058
Gary T. Grassey

Endnotes

1 As set forth in the Commission's administrative subpoenas dated August 12, 2003 and August 20, 2003, Cherrywood Publishing, Inc. refers to all divisions, subsidiaries, business units, predecessors, successors, assigns and partners thereof, including without limitation The Gary Halbert Letter, Inc., thegaryhalbertletter.com, Everett & Lloyd, Inc., and New Millenium Publications.

2 The advertisement also indicates that Bond Halbert is Gary C. Halbert's son. See Grassey Declaration, ¶ 6. Further, according to the advertisement, Bond Halbert is apparently responsible for discovering "secret software" that provides benefits in connection with stock trading systems, including his father's system. See Grassey Declaration, ¶ 6 at note 2.

3 The subpoena to Cherrywood only compelled the production of documents, while the others compelled the production of documents and testimony.

4 The Commission need not make out a "probable" or "reasonable" cause showing in order to conduct an investigation. Howatt, 525 F.2d at 229; Brigadoon Scotch, 480 F.2d at 1053. In United States v. Morton Salt Co., 338 U.S. 632, 643 (1950), the Supreme Court compared an agency inquiry to that of a grand jury, which can investigate on mere suspicion that the law has been violated without a showing of probable cause. Like the Federal Trade Commission in Morton Salt, the Commission performs a function similar to that of a grand jury, and the scope of its inquiries is not to be limited narrowly by questions or forecasts of the probable results of its investigations. United States v. Bisceglia, 420 U.S. 141, 147-48 (1975) (quoting Blair v. United States, 250 U.S. 273, 287 (1919)); see Arthur Young & Co., 584 F.2d at 1023-24; Brigadoon Scotch, 480 F.2d at 1052-53.

5 Indeed, three months have elapsed since the issuance of the June 6, 2003 Voluntary Request to Gary C. Halbert and Cherrywood, which requested nearly all of the same documents compelled by the August 12th and August 20th subpoenas.

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