Scorpion Technologies, Inc., et al.

LITIGATION RELEASE NO. 17478 / April 18, 2002

SEC SETTLES CHARGES AGAINST DUDLEY MIHRAN FREELAND FOR FRAUD INVOLVING SALES OF SCORPION STOCK

SECURITIES AND EXCHANGE COMMISSION V. SCORPION TECHNOLOGIES, INC., ET AL., 96-CIV-1005 (S.D.N.Y.)

The Securities and Exchange Commission announced that on April 15, 2002, the Honorable Barbara S. Jones, United States District Judge for the Southern District of New York, entered a Final Judgment of Permanent Injunction and Other Equitable Relief by Consent against Dudley Mihran Freeland ("Freeland") of Los Angeles County, California. The Final Judgment enjoins Freeland from future violations of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and Rules 101 and 102 of Regulation M promulgated under Section 10(b) of the Exchange Act, and as a controlling person within the meaning of Section 20(a) of the Exchange Act, from future violations of Sections 10(b) and 15(c)(1) of the Exchange Act and Rules 10b-3, 10b-5, 15c1-2 and 15c1-6 thereunder, and Rules 101 and 102 of Regulation M promulgated under Section 10(b) of the Exchange Act. The Final Judgment also provides that the Commission's claim for disgorgement against Freeland is satisfied by the assets previously disgorged pursuant to the Stipulation and Order, dated December 31, 1991, in SEC v. H.K. Freeland & Company, Inc., 91 Civ. 7986 (S.D.N.Y.). The Commission's Amended Complaint filed May 9, 1996 alleged that Freeland, through H.K. Freeland & Company, a now defunct registered broker-dealer, participated in a fraudulent scheme involving a registered offering of two million shares of Scorpion common stock. This case, which had been put on the suspense docket pending resolution of a related criminal proceeding in the District Court for the Northern District of California, was restored to the active docket in July 2001.