Case 2:20-cv-03108-MCS-JPR Document 1 Filed 04/02/20 Page 1 of 36 Page ID #:1
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`LYNN M. DEAN (Cal. Bar No. 205562)
`Email: deanl@sec.gov
`CHRISTOPHER A. NOWLIN (Cal. Bar No. 268030)
`Email: nowlinc@sec.gov
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`Attorneys for Plaintiff
`Securities and Exchange Commission
`Michele Wein Layne, Regional Director
`Alka Patel, Associate Regional Director
`Amy J. Longo, Regional Trial Counsel
`444 S. Flower Street, Suite 900
`Los Angeles, California 90071
`Telephone: (323) 965-3998
`Facsimile: (213) 443-1904
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`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
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`SECURITIES AND EXCHANGE
`COMMISSION,
`Plaintiff,
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` Case No.
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`COMPLAINT
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`
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`vs.
`OWNZONES MEDIA NETWORK,
`INC., DANIEL GOMAN and JOSEPH
`GOMAN,
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`Defendants.
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`Plaintiff Securities and Exchange Commission (“SEC”) alleges:
`JURISDICTION AND VENUE
`The Court has jurisdiction over this action pursuant to Sections 20(b),
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`20(d)(1) and 22(a) of the Securities Act of 1933 (“Securities Act”), 15 U.S.C. §§
`77t(b), 77t(d)(1) & 77v(a), and Sections 21(d)(1), 21(d)(3)(A), 21(e) and 27(a) of the
`Securities Exchange Act of 1934 (“Exchange Act”), 15 U.S.C. §§ 78u(d)(1),
`78u(d)(3)(A), 78u(e) & 78aa(a).
`Defendants have, directly or indirectly, made use of the means or
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`Case 2:20-cv-03108-MCS-JPR Document 1 Filed 04/02/20 Page 2 of 36 Page ID #:2
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`instrumentalities of interstate commerce, of the mails, or of the facilities of a national
`securities exchange in connection with the transactions, acts, practices and courses of
`business alleged in this complaint.
`Venue is proper in this district pursuant to Section 22(a) of the Securities
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`Act, 15 U.S.C. § 77v(a), and Section 27(a) of the Exchange Act, 15 U.S.C. § 78aa(a)
`because certain of the transactions, acts, practices, and courses of conduct
`constituting violations of the federal securities laws occurred within this district. In
`addition, venue is proper in this district because defendant Daniel Goman resides in
`this district and defendant OwnZones Media Network, Inc. has its principal place of
`business here.
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`SUMMARY
`From 2011 through the present, OwnZones Media Network, Inc., its
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`CEO and president Daniel Goman (“Dan Goman”), and its agent and stock salesman
`Joseph Goman (“Joe Goman”) raised roughly $45 million offering and selling an
`unregistered securities offering to over a thousand investors without any exemption
`from registration. The company engaged in general solicitation and raised money
`from numerous unaccredited investors, purporting to avoid selling to too many
`unaccredited investors by devising a “subinvestment” process whereby
`“subinvestors’” money has been aggregated under supposedly accredited “direct
`investors.” OwnZones is continuing to raise money through its unregistered offering,
`taking in millions of dollars in recent months.
`OwnZones, Dan Goman, and Joe Goman also committed fraud in the
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`course of offering and selling OwnZones stock. Joe Goman, while selling OwnZones
`stock on behalf of the company, made multiple misstatements to investors that ranged
`from saying that Venture Capitalist MC and MGM had purchased OwnZones stock
`for $5 per share to representing that Google had offered to buy OwnZones for $500
`million. Joe Goman also made baseless predictions that OwnZones was about to go
`public and that its IPO price would be many multiples higher than what investors
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`Case 2:20-cv-03108-MCS-JPR Document 1 Filed 04/02/20 Page 3 of 36 Page ID #:3
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`were paying for their shares. OwnZones and Dan Goman made additional statements
`to investors concerning OwnZones’ IPO and the status of discussions with major
`company investors that were false or misleading. Moreover, Dan Goman, who runs
`the company’s day-to-day operations and has primary responsibility for handling
`investments in the company, is liable as a control person of OwnZones, and he did
`not act in good faith because he ignored multiple warning signs about Joe’s
`misconduct in connection with his OwnZones fundraising efforts.
`By this conduct, all of the Defendants violated Sections 5(a), 5(c), and
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`17(a) of the Securities Act and Section 10(b) of the Exchange Act and Rule 10b-5
`thereunder. In addition, Dan Goman is liable under Section 20(a) of the Exchange
`Act for OwnZones’ violations of that Act.
`The SEC seeks permanent injunctions against future violations of
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`Sections 5 and 17(a) of the Securities Act and Section 10(b) of the Exchange Act and
`Rule 10b-5 thereunder; disgorgement with prejudgment interest; and civil penalties as
`to all Defendants.
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`THE DEFENDANTS
`OwnZones Media Network, Inc. is a Nevada corporation based in
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`Beverly Hills, California. OwnZones is an entertainment technology company that
`claims to provide a technology that allows content providers to make their content
`available in a standardized format to various digital platforms. OwnZones has not
`registered any offerings or securities with the SEC.
`Daniel Goman, age 43, is a resident of Los Angeles, California. He is
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`the founder, sole board member, president, chief executive officer, and largest
`shareholder of OwnZones Media Network, Inc.
`Joseph Goman, age 31, is a resident of Phoenix, Arizona. He is Dan
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`Goman’s younger brother and was, until May 2018, a paid consultant for OwnZones
`who presented to current and prospective investors and also performed business
`development and sales functions.
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`Case 2:20-cv-03108-MCS-JPR Document 1 Filed 04/02/20 Page 4 of 36 Page ID #:4
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`THE ALLEGATIONS
`A. Overview of OwnZones and Dan Goman’s Role
`11. OwnZones is an entertainment-technology company based in Beverly
`Hills. The company has developed a cloud-based technology that supposedly allows
`content providers to more efficiently and cheaply make available their content
`packages in a standardized format to various digital platforms.
`12. OwnZones has provided services for various well-known companies,
`including Magnolia Pictures (Venture Capitalist MC’s film company), MGM
`Entertainment, and Sinclair Broadcasting. The company has never been profitable.
`13. Dan Goman, OwnZones’ founder, chief executive officer, president, and
`largest shareholder, runs OwnZones’ day-to-day operations.
`14. Dan Goman has ultimate authority over and responsibility for
`OwnZones’ interactions with investors and prospective investors, and he has final
`authority for determining whether to accept someone’s investment in OwnZones.
` Dan Goman is the sole signatory on OwnZones’ bank account that
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`receives both investor money and revenue from OwnZones’ business, and he has the
`sole authority to disburse money out of the account.
`16. As CEO, Dan Goman has exclusive authority to decide if OwnZones
`will take on major investments or be acquired or bought, as well as sole authority to
`sell off significant company assets.
`17. Per a 2013 board resolution executed by Dan Goman as the sole member
`and director of OwnZones’ board of directors, OwnZones pays the “critical expenses”
`for Dan Goman and his family, which include their day-to-day living expenses.
`B. OwnZones’ Unregistered Offering to Retail Investors
`18. OwnZones started the offering which it has referred to as its “Series A”
`round of funding in July 2011, offering its stock at $0.25 per share.
`19. The Series A offering was ongoing from 2011 through at least February
`2020.
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`Case 2:20-cv-03108-MCS-JPR Document 1 Filed 04/02/20 Page 5 of 36 Page ID #:5
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`In total, OwnZones’ Series A offering has raised at least $45 million
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`from hundreds of investors since July 2011.
`21. OwnZones never registered its offering with the SEC.
`22. OwnZones claimed in a Form D it filed with the SEC in April 2014 that
`it was relying on an exemption under Securities Act Regulation D, Rule 506(b).
`23. As of April 29, 2019, the company had raised at least $39,049,603.78
`during its Series A offering from over 1,000 investors. Of that amount, over
`$33,809,988 was raised since the beginning of 2014.
`24. Dozens of investors, some of whom had invested previously in
`OwnZones, have again invested in OwnZones in the last 12 months. Some of the
`recent deposits into OwnZones’ account are for hundreds of thousands of dollars and,
`given OwnZones’ method of selling stock in the past, (see Section E, infra), likely
`consist of money aggregated from a number of individuals investing under a single
`individual’s name.
`25. OwnZones raised $420,000 from investors in January 2020, the last full
`month for which the SEC has bank records.
`C. OwnZones’ Purported Series B Raise
`26. OwnZones made some unsuccessful attempts to raise money from
`institutional investors, some of whom have contractual business relationships with
`OwnZones. It deceived other investors by misrepresenting the status of these
`fundraising efforts.
`27. OwnZones referred to its attempts to attract institutional investors as its
`“Series B” or “Series B raise.” While OwnZones had preliminary discussions with a
`number of large, well-known companies, including companies with ties to Venture
`Capitalist MC, as well as MGM, Sinclair Broadcasting, and Google Ventures, those
`discussions never progressed to discussing critical terms of investment such as price
`per share and never resulted in an offer to invest.
`28. OwnZones frequently referred to the Series B raise in its emailed
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`investor updates and presentations, suggesting that it was near closing a Series B
`offering and that the offering would allow it to “hit its IPO.” As of the end of
`September 2019, none of the major companies identified by OwnZones in its investor
`communications as being likely investors in the company had invested or offered to
`invest in OwnZones in Series B.
`D. OwnZones’ Solicitations of Series A Investors
`29. Between 2011 and the beginning of 2016, Dan Goman was the principal
`person responsible for raising money for OwnZones and interfacing with investors.
`30. Dan Goman’s efforts to solicit investors for OwnZones generally
`consisted of “networking and meeting with a lot of people.”
`31. Approximately 80% of the capital raised by OwnZones came from
`Romanians or the Romanian-American community.
`In early 2016, Dan Goman began to engage others to assist in soliciting
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`OwnZones investors.
` In early 2016, Dan Goman gave his brother Joe Goman the task of
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`presenting information about OwnZones to existing and prospective investors.
`Joe Goman was authorized to, and did, present to existing and potential
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`investors.
`35. From March 2016 up until at least mid-2017, Joe Goman made a series
`of live presentations to groups of prospective investors, many of whom were
`acquaintances of existing investors or acquaintances of acquaintances.
`Joe Goman raised at least $6 million from hundreds of people, many of
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`whom had not previously invested in OwnZones.
`37. From summer 2016 until November 2017, Individual F worked in
`OwnZones investor relations and communicated with investors from the company’s
`investor relations email account. Individual B replaced her in approximately
`November 2017. Individual B continues to work at OwnZones. Individual F, and
`later Individual B, would field investor inquiries, handle investor documentation
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`issues, and send out investor updates authored by Dan Goman.
`38. OwnZones used a “Series A Common Stock Subscription Agreement”
`that included a section titled “investor qualifications,” where prospective investors
`were asked to check off whether they had a particular minimum net worth or made a
`specified minimum annual income.
`39. Dan Goman was aware that to qualify for an exemption from
`registration, OwnZones could raise money from a maximum of 35 unaccredited
`investors.
`Joe Goman was aware that OwnZones could have only 35 unaccredited
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`investors to qualify for an exemption from registration, and discussed that limit with
`Dan Goman when Joe Goman started presenting to investors in early 2016.
`41. OwnZones relied soley on prospective investors’ representations in the
`subscription agreements and did not collect information from the investors to verify
`their net worth and income information, nor did it collect information related to the
`investors’ sophistication.
`42. OwnZones did not provide investors with audited or unaudited financial
`statements.
`43. OwnZones’ April 2014 Form D indicated that as of that date, it had 34
`unaccredited investors.
`44. The company’s internal capitalization tables indicate that it had at least
`35 unaccredited investors by early 2014.
`45. Nearly all the hundreds of investors listed in OwnZones’ internal
`capitalization tables are labeled as “accredited.”
`E. OwnZones’ Use of Subinvestors and Inaccurate Designations of Investors’
`Accreditation
` The capitalization tables maintained by OwnZones about whether its
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`investors are accredited are inaccurate, because the company in reality has far more
`than 35 unaccredited investors.
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` In addition to the 35 unaccredited investors shown on OwnZones’
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`internal capitalization table, OwnZones has hundreds of “subinvestors,” whose funds
`were aggregated under several OwnZones’ investors whom OwnZones referred to as
`“direct investors.”
` In addition, many of the “direct investors” identified in OwnZones’
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`internal capitalization table as “accredited” are in fact unaccredited investors.
`Subinvestors
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` From at least February 2016 to late 2018, OwnZones aggregated
`hundreds of individuals’ investments by categorizing them as “subinvestors” under
`the names of other direct investors in OwnZones’ internal capitalization table.
` The direct investor and each subinvestor under his or her account would
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`enter into a form “Stock Purchase Agreement” or “subinvestment agreement,” which
`set out that the direct investor would purchase OwnZones stock on behalf of the
`subinvestor, with the subinvestor’s money, and hold that stock in the direct investor’s
`name until OwnZones either conducted an initial public offering or achieved some
`other liquidation event, at which point the stock would be transferred to the
`subinvestor.
`51. The subinvestment agreements stated that the direct investor had spoken
`with Dan Goman about the transaction and that Dan had said this was an acceptable
`way for the subinvestor to buy pre-IPO stock in the company without meeting a
`minimum purchase amount.
`52. OwnZones provided the direct investor with a subscription agreement
`and stock certificate with OwnZones in the direct investor’s name for a total sum of
`whatever he and the subinvestors under him had invested.
`53. The subinvestors had no direct agreement with OwnZones.
`54. Although the subinvestors had no direct agreement with OwnZones, they
`generally made their checks payable to OwnZones or wired or deposited their money
`directly into the company’s bank account.
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`55. OwnZones did not request any information from subinvestors regarding
`their net worth, income, or sophistication, nor did it ask the direct investors to request
`such information from the subinvestors or provide the direct investors any restrictions
`on who could be subinvestors.
`56. Dan Goman and others at OwnZones were aware of and encouraged
`subinvestment as a means of investing in OwnZones.
`57. For example, in February 2016, Dan Goman emailed the subinvestment
`agreement to Joe Goman, who used it to raise millions of dollars from hundreds of
`subinvestors from March 2016 to at least the end of 2017.
` Joe Goman understood the purposes of subinvestment as being
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`twofold—first, to keep the number of direct investors down, and second, to allow
`people who were unaccredited to invest.
`In or around March 2016, Dan Goman told Investor D, a direct investor
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`with over 50 subinvestors under her account, that the subinvestment agreement came
`from OwnZones and that she should use it to sign up subinvestors.
`60. At various points between June and October 2016, Dan Goman
`described the subinvestment process to company investor relations representative
`Individual F and provided her with the subinvestment agreement and various
`communications detailing the mechanics of the subinvestment process.
`61. Dan Goman also on various occasions directly approved requests for
`people to invest as subinvestors.
`62. Up until at least mid-2018, OwnZones’ investor relations representatives
`routinely corresponded with direct investors about the subinvestment process, often
`exchanging spreadsheet summaries of the subinvestors under particular direct
`investors, and even in some cases directly sending the subinvestment agreement to
`direct investors for them to use.
`63. At OwnZones’ invitation, many subinvestors attended a series of
`company presentations in late 2016 and early 2017 where Dan Goman made
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`presentations to existing investors (referred to by OwnZones as “road shows”).
`64. Between March 2016 and the end of 2017, OwnZones raised millions of
`dollars from hundreds of subinvestors.
`65. None of the subinvestors is reflected on OwnZones’ capitalization tables
`as investors in the company. Instead, they are grouped under different direct
`investors, some of whom have dozens of subinvestors and hundreds of thousands
`dollars in subinvestor money under their accounts.
`66. OwnZones has collected no information from the subinvestors to
`establish their accreditation status.
` OwnZones’ incomplete records of subinvestors make it impracticable
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`to determine the identities, or accreditation status, of all of OwnZones’ shareholders.
`Unaccredited Investors Listed as Accredited
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`68. Certain direct investors designated in OwnZones’ records as accredited
`are actually unaccredited.
`69. At least seven investors represented to OwnZones in their subscription
`agreements that they did not satisfy any of the standards to qualify as accredited
`investors.
`70. However, those same investors are identified as accredited in the
`subscription agreements and internal company capitalization tables.
`71. At least one direct investor, Investor D, who is listed in OwnZones
`records as “accredited” and who has at least 65 subinvestors under her account, is not
`accredited.
`Joe Goman told Investor D she should indicate she was accredited on her
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`purchase agreement, which she did.
`Joe Goman’s Role at OwnZones
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`Joe Goman began working for OwnZones in early 2016.
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`74. When he was hired, Joe Goman did not have prior experience raising
`funds for investments.
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`Joe Goman worked for OwnZones until May 2018.
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`76. At various times during his work for OwnZones, Joe Goman’s
`responsibilities included raising money, interacting with investors, and performing
`business development and product sales functions.
`In or about late 2015 or early 2016, Joe and Dan Goman discussed
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`having Joe present to investors for purposes of raising additional money. Dan Goman
`approved Joe doing so.
`In or about March 2016, Dan Goman spoke to Investor D, an investor
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`whose network of friends Joe Goman presented to, that Joe would be handling the
`raising of funds for OwnZones.
`In February 2016, Dan Goman emailed Joe Goman a form
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`subinvestment agreement. Joe understood that he was to use the subinvestment
`agreement to sign up investors.
`In March 2016, Dan Goman emailed Joe Goman a power point
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`presentation for Joe to use to present to investors. Upon information and belief, Dan
`Goman approved the content of the power point presentation.
`81. While he was making presentations to investors, Joe Goman had access
`to OwnZones’ password-protected DropBox account that contained a number of other
`documents describing OwnZones’ business, which Joe used in his presentations to
`investors. Dan Goman was aware that Joe Goman had access to the Dropbox
`account.
`82. OwnZones compensated Joe Goman by reimbursing him for his
`expenses incurred in traveling to present to investors, and also by providing him a
`salary tied to time he spent on investor matters and business development efforts.
`Joe received Dan Goman’s approval before traveling to present to
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`investors.
`84. Typically, after each trip, Joe Goman would meet with Dan Goman and
`update him about the trip, and Dan would approve of Joe’s compensation payment.
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` Joe, who was formally retained as a consultant, received his first check
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`from OwnZones in March 2016. Throughout 2016 and 2017, while he was actively
`raising money for OwnZones, he generally received checks each month that totaled
`anywhere between $3,000 and $5,000. In total, Joe Goman received at least $89,000
`in compensation and expense reimbursement from OwnZones for his work.
`86. At some point in early 2016, OwnZones, with Dan Goman’s approval,
`provided Joe Goman with an OwnZones email address.
`Joe used this OwnZones email address to communicate with OwnZones
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`investors.
`88. On March 23, 2016, Individual F, OwnZones investor relations
`employee, forwarded Joe a business card template with the job title, “Joe Goman,
`OwnZones Consultant.” The business card contained OwnZones’ logo and website,
`as well as the company’s Phoenix physical address and office phone number.
`Joe Goman used this template to create business cards that he passed out
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`at presentations to investors.
`Individual F saw Joe Goman make at least one presentation to
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`prospective investors in OwnZones’ Phoenix office.
`Joe Goman made sales presentations to investors in OwnZones’ Beverly
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`Hills office in June 2016. Joe also accepted checks in the Beverly Hills’ office on a
`different date from at least one investor.
`Joe provided investors with documentation reflecting his apparent and
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`actual authority to sell stock for OwnZones, including an “OwnZones Investment
`Opportunity Agenda” that prominently displayed the OwnZones logo, phone number,
`and email address and described Joe as an “OwnZones Consultant/Financial
`Planner.”
`93. Throughout 2016 and 2017, Individual F, OwnZones’ investor relations
`employee, routinely referred existing and prospective investors with questions to Joe
`Goman, referring to him in one case as “our representative.”
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`In 2016 and 2017, Individual F also often consulted Joe Goman as a
`94.
`source of information when investors asked her questions about OwnZones.
`Joe Goman’s Presentations and Statements to Investors
`G.
`In early 2016, Joe Goman began presenting to existing and prospective
`95.
`OwnZones investors. He made numerous false statements during his presentations,
`some of which were captured on video recordings.
`96. Through his presentations and conversations with investors, Joe Goman
`raised millions of dollars, which OwnZones accepted, from multiple networks of
`investors.
` In two separate written communications, one dated December 4, 2018
`97.
`and another dated February 25, 2019, Joe Goman claimed that he had raised up to
`$12 million for OwnZones.
`Joe Goman’s March 2016 statements to investors
`1.
`98.
`In March 2016, Joe Goman traveled to Southern California to present to
`Investor D, an OwnZones investor, and her friends and associates.
`99. Dan Goman knew of this trip and authorized it.
`100. Investors in attendance at the March 2016 presentation in Southern
`California believed that Joe Goman had authority to sell stock on behalf of
`OwnZones. Investor D was personally told by both Dan Goman and Joe Goman that
`Joe had such authority.
`101. On March 26, 2016, Joe Goman sent Investor D an email describing
`OwnZones as the “financial opportunity of a lifetime.” Joe’s email also stated that
`OwnZones had received “buyout offers” from two major companies, elaborating that
`“[a] buyout offer means the risk to investors is essentially zero.” The email stated
`that OwnZones was only months away from going public and compared it to other
`major technology companies that had seen huge increases in stock prices when they
`went public, making their early investors “millionaires many times over.”
`102. On March 28, 2016, Investor D sent out her own email to friends with
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`the subject line “Exclusive Investment Opportunity.” In this email, Investor D pasted
`the content that Joe Goman had provided On March 26, 2016 and also included
`additional information. The email stated that OwnZones was “about to go public”
`and had received “many fruitful offers from major companies such as MGM, Time
`Warner and Google, all wanting to buy our company.” The email also described this
`as the “very last opportunity to invest in OwnZones before it goes public,” indicating
`that “[a]ll money would need to be available this week” because “[t]his is a very time
`sensitive opportunity.” The email indicated that Dan Goman was sitting down with
`the heads of MGM and Google the next day, noting that time was of the essence to
`invest. Investor D obtained the information in this email from Joe Goman, who was
`aware she would be providing it to prospective investors.
`103. Joe Goman presented to various prospective investors at Investor D’s
`residence in the days after Investor D sent her March 28 email about the investment.
`At these presentations, Joe Goman again reiterated that OwnZones was about to go
`public.
`104. Joe Goman’s representations to investors during these early
`presentations were false. OwnZones had not received buyout or investment offers
`from any major companies as of March 2016, let alone from MGM, Time Warner, or
`Google. As of March 2016, OwnZones was not planning to go public within only a
`few months and had not taken any significant steps towards that process. Dan
`Goman was also not about to sit down with the heads of MGM and Google to discuss
`those companies investing in OwnZones, and the investment was not about to close.
`Joe Goman’s May 2016 presentation to investors
`2.
`105. In May 2016, Joe Goman traveled to Washington State to present
`information regarding OwnZones to a group of investors at the home of one of his
`sisters.
`106. Dan Goman was aware that Joe was traveling to make this presentation.
`107. The May 2016 presentation was videotaped at Joe’s direction, and Joe
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`afterwards sent the video to a direct investor in Sonora, California who had a network
`of dozens of subinvestors under his account.
`108. Joe Goman’s May 2016 presentation to investors was authorized by
`OwnZones.
`109. Another OwnZones employee joined Joe’s presentation via video
`conference from OwnZones’ Phoenix office, spoke about OwnZones’ technology,
`and provided a virtual tour of the Phoenix office for those investors in attendance at
`Joe’s presentation.
`110. During the May 2016 investor presentation in Washington, Joe Goman
`made false statements that certain famous individuals and companies had invested in
`OwnZones. For instance, Joe said, “We’re selling shares right now to Venture
`Capitalist MC and MGM and they want to come in with significant amounts of
`money. And we’re selling shares to them at $5.” Joe Goman emphasized to his
`audience the importance of his false claims regarding the investment offers from
`major companies, saying, “So automatically, if you just want to put it like that, the
`minimum it could possibly enter in at is $5, so every 25 cents will get turned into $5.
`So at this point of the game, there’s no risk involved. It’s not a risk that you guys are
`taking. It’s a blessing that we are giving.”
`111. Joe’s statements about Venture Capitalist MC and MGM were false.
`While OwnZones had engaged in some preliminary investment discussions with
`MGM and a representative of Venture Capitalist MC, neither had ever made any
`actual offers to invest in OwnZones at any particular price per share, nor had they
`actually invested.
`112. Joe Goman also falsely stated during this presentation that Warner
`Brothers had offered to invest in OwnZones and that OwnZones was not sure if it was
`going to accept the offer.
`113. Joe Goman also falsely stated during this presentation that OwnZones
`was going to go public by the end of 2016, stating that he personally believed it could
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`occur sooner than that. Joe Goman pressured investors, stating that OwnZones would
`be closing the investment opportunity within weeks to adhere to its target to hit its
`IPO at the end of 2016.
`114. In fact, OwnZones did not have a plan in May of 2016 to complete its
`IPO by the end of that year, and OwnZones has never taken substantial steps towards
`an IPO, such as hiring an investment banker, or hiring counsel to prepare a
`registration statement.
`Joe Goman’s June 2016 presentation in OwnZones’ Beverly Hills
`3.
`office
`115. In June 2016, Joe Goman gave another presentation in OwnZones’
`Beverly Hills office to OwnZones investors associated with Investor D. This
`presentation was also recorded with Joe’s knowledge, and the video recording was
`made available to investors not in attendance. During the presentation, Joe Goman
`made multiple false and misleading statements.
`116. At the June 2016 presentation, Joe Goman stated that Google had
`offered to “buy out” OwnZones for $500 million but OwnZones did not accept the
`offer.
`117. This statement was false, as Google has never offered to invest any
`amount in OwnZones.
`118. Joe Goman also spent a significant part of the June 2016 presentation
`describing how Sinclair Broadcasting was on the verge of merging with or making a
`significant investment in OwnZones. Joe stated that Sinclair had told OwnZones that
`“[t]he only way we’ll sign this c