Securities & Exchange Commission v. First Pacific Bancorp

The Securities and Exchange Commission brought a civil enforcement action against Leonard S. Sands, First Pacific Bancorp (Bancorp), and PacVen Inc. for violations of the antifraud, filing and disclosure provisions of the federal securities laws. The district court granted partial summary judgment in favor of the SEC on three of its claims. 1 After a bench trial, the court ruled in favor of the SEC on all of its remaining claims. Sands, Bancorp and PacVen appeal the dis *1189 trict court’s grant of partial summary judgment. They also appeal the court’s final judgment, which permanently enjoins them from future violations of the securities laws, orders them to disgorge $688,000 plus prejudgment interest, and permanently bars Sands from acting as an officer or director of a public company. We affirm.

BACKGROUND

Sands was the chairman of the board, chief executive officer and corporate counsel of Bancorp, a Delaware corporation organized as a bank holding company, and owned 54% of its common stock. Sands was also the chairman of the board and corporate counsel of First Pacific Bank, Inc. (Bank), the wholly owned subsidiary of Bancorp and its major asset. In addition, Sands was the…