United States District Court, S.D. New York
S. BRODERICK, UNITED STATES DISTRICT JUDGE
a conference with the parties via telephone on December 30,
2019, to discuss the issues relating to service of
Plaintiff's motion for summary judgment. Upon
consideration of the issues raised at the conference it is
that Defendants' opposition, if any, to Plaintiff's
motion for summary judgment (Doc. 252) is due on February 9,
2020, and Plaintiff's reply, if any, is due on March 2,
2020. I have attached a copy of Plaintiff's summary
judgment papers to this Order, which will be sufficient for
service upon the Defendants.
Clerk of Court is respectfully directed to mail a copy of
this Order and its attachments to the pro se Plaintiff and
Take Notice, upon the accompanying memorandum of law in
support of plaintiffs motion for summary judgment, plaintiff
declaration, attached appendix of exhibits, and statement of
undisputed fact, plaintiff Timothy Andrew McCaffrey moves
this Court and the Honorable Vernon S. Broderick on October
14, 2019 or as soon thereafter as may be heard for entry of
order pursuant to FDRCP 56 and Local 56.1 granting plaintiffs
motion for summary judgment, and awarding plaintiff the award
sought in this matter and such other relief deemed just and
proper by the Court.
New York, New York August 26, 2019 Respectfully submitted, By
Timothy Andrew McCaffrey, Pro Se CERTIFICATE of
SERVICE I hereby certify that Plaintiffs Notice, Memorandum,
Statement of Fact and the Declaration with Appendix, were
filed electronically and served on defendants by email.
York August 26, 2019
submitted, By: Timothy Andrew McCaffrey, Pro Se
OF FACT PURSUANT TO LOCAL RULES 56.1
or about July 2011, Gatekeeper began offering shares of its
common stock for sale in private transactions, stating
“only from ‘accredited investors' who satisfy
the suitability standards” under federal securities
regulations (App. A p.2).
or about early 2012, Seetoo approached plaintiff with the
intention of inducing plaintiff to invest in Gatekeeper (App.
B p.1). In an email, Seetoo included subscription documents,
business and marketing literature, and a proof of concept
(POC) report (App. B pp.3-8).
3. In a
subsequent email to plaintiff Seetoo sent the PPM dated July
2011 (App. B p.3).
Seetoo told plaintiff “the recent market price is
$2.75-$3.25” but that plaintiff could buy through
“ [the Company's] Private Placement…at
$1” a share (App B pp.1-10).
Seetoo also offered to Plaintiff the same sorts of
compensation that Seetoo was receiving for enlisting other
investors (App. B p.10, App. G LeonSEC).
Seetoo also told Plaintiff of the opportunity for a short
squeeze and indicated that there was opportunity for returns
greater than 1000% (App. B pp.14, 33).
Seetoo knew at the time but did not disclose to plaintiff
that the public price was being kept artificially high
through the buying activities of (among others) a Minnesota
financial advisor named Howard Richards, working in concert
with the defendants (App. C pp.4-6).
addition to Seetoo, the two controlling officers of
Gatekeeper, Leontakianakos and Gatekeeper CEO Wishart, each
had knowledge of Mr. Richards' manipulation of the market
in Gatekeeper shares (App. C Id.).
Seetoo further represented that the Company was “in the
midst of closing out the balance of a $10M Reg-D private
placement with some institutional sized investors . . . [and
that] $4M has already been Patriot Act cleared and allocated
to a designated account” (App. B pp.1-12).
Plaintiff was told and it was outlined in the PPM that
capitalization of the Company meant large scale production of
a device called CAMS (App. B pp.1-10) (App. A pp.2-35).
CAMS device does not exist (App. G LeonSEC). No. one
associated with Gatekeeper has ever seen or touched it
(Id. Leon. Wish. Seetoo).
Seetoo and Asgard further represented through a hyperlink at
the Asgard website to the website of Development Solutions
that Gatekeeper was already “Funded $10M” (App. M
such deal or deals were ever consummated.
Seetoo represented that Gatekeeper was “about to get
listed on the NASDAQ, ” (App B pp. 13, 18, 34, 38).
same claims were made publicly as far back as at least 2009
by Gatekeeper CFO John Leontakianakos and Gatekeeper as
instructed by CEO Wishart (App. F pp.6, 46) (App. G LeonSEC).
Plaintiff told Seetoo his participation was dependent on a
distribution from a property sale (App. B pp.1-10), and in an
email to Seetoo he expressed doubt that he would able to
participate in time for the closing of the Private Placement
because he had no funds (App B p.10).
Seetoo offered to “get [plaintiff] an extension of 3
weeks or so after the close” and told plaintiff that
plaintiff could “pre submit signed docs” and that
plaintiff could “pay later” (App B pp.9-10).
Seetoo also stated that a company called Ares would be
handling the sale of smaller lots for Gatekeeper during the
private placement. (App B pp.14, 15, 21, 22, 25).
Defendants presented plaintiff with subscription documents
that included the Private Placement Memorandumpresented to
plaintiff, dated July 1, 2011(App B pp.6-7).
Defendant Seetoo also presented Gatekeeper business plans,
financials, and related promotional documents to plaintiff
(Id.) which had been created for the Company by
Gatekeeper CEO James Wishart (App. C p.9) (App. G LeonSEC).
Wishart had provided these materials for Gatekeeper by email
to Seetoo and Leontakianakos for distribution to potential
investors in the Company just days prior to their being
delivered to plaintiff (App. C p.9)
Seetoo assured plaintiff that closings, filings, and
tradability of shares was imminent (App B pp.29, 33).
Plaintiff insisted that everything Seetoo said must be true
or he could not afford to participate (App B p.27).
Wishart was also responsible for coordinating and directing
publicity activity for Gatekeeper and directed both
Leontakianakos and Seetoo in this regard (App. C p.41
Following) and (App. G LeonSEC).
Plaintiff was proffered a stock transfer agreement by email
by Seetoo and instructed to wire his funds for the purchase
of the shares to Ares (App. B).
Relying on Seetoo's assurances and on the accuracy of the
materials presented to him, plaintiff signed the stock
transfer agreement and wired $50, 000 to Ares (App. B).
stock transfer agreement stated that Ares was a
“corporation” “in good standing” and
organized in “the State of Nevada.” Plaintiff
understood GateKeeper to be a Nevada Company.
Unbeknownst to plaintiff Ares was owned by Leontakianakos,
the Executive Vice President of GateKeeper.
Unbeknownst to plaintiff, Ares was not a
“corporation” “in good standing”.
Unbeknownst to plaintiff, Ares was not organized in Nevada
but was organized in New York.
Leontakianakos personally generated the Ares stock transfer
agreement (App. G LeonSEC).
or about September 2013, Plaintiff approached Gatekeeper to
propose a settlement to include return of the purchase price.
Defendants disclosed to plaintiff that his purchase had not
been, as he had been led to believe by defendants, from the
Company, but from an unidentified third party.
money that plaintiff wired to Ares was spent by
Leontakianakos for his personal use (App. G LeonSEC).
various time, Leontakianakos has used the proceeds from sales
of GateKeeper shares by Ares for both his personal use and to
pay the expenses of GateKeeper (App. G LeonSEC).
Seetoo received compensation for directing plaintiff to
purchase shares in GateKeeper through Ares. (App. G LeonSEC).
third party was in fact Angelica Leontakianakos, the wife of
defendant Leontakianakos. (App. M pp.95-108).
From at least 2008 to 2012, Gatekeeper issued a series of
press releases at the Gatekeeper website and elsewhere,
written by Leontakianakos and Wishart and “signed off
on” by Wishart (App. F) (App. G LeonSEC).
Prior to his purchase of shares of GateKeeper plaintiff read
these press releases at the GateKeeper website and elsewhere.
Press releases, and promotional literature distributed to
plaintiff and others, represented Gatekeeper as a viable
company with a viable technology ready for market and in some
cases already on the market (App. F)
truth, Gatekeeper's was a dire financial situation. CEO
Wishart and the defendants took part in email discussions
pertaining to the floundering Company's gloomy prospects
within 4 weeks of their decision to sell plaintiff shares
(App. C pp.2123). This was less than 10 days after
circulating a new PPM dated May 31, 2012 (App. D), and about
two weeks before circulating a third dated July 30, 2012
(App. E), and was in addition to ongoing circulation of Ares
purchase agreements (App. E pp.1-10).
Gatekeeper had sought out loans from shareholders to pay for
OTC filings, CEO James Wishart's insurance, legal
retainers, and other common fees as well as personal loans
for themselves (App C) (App. G LeonSEC). They did not
disclose lawsuits to Plaintiff that were ongoing and would
affect their ability to address their public statements about
Gatekeeper (App. C p.27).
defendants participated in and were privy to email exchanges
in which the lack of capital and the lack of progress and the
likelihood of failure were acknowledged and discussed openly
(App. C pp.1-3, 8, 10-12, 21-23, 38-).
Gatekeeper leadership and the defendants represented
themselves as industry professionals with special knowledge
of the financing of publically traded companies. But other
industry professionals they approached complained in emails
and communications delivered to the defendants that
Gatekeeper's model for financing was not viable and would
never receive the sought after funding in its current state.
Some even questioned the legitimacy of the Company and the
existence of the technology itself (App. C).
spite of knowing that these questions loomed, the defendants
arranged for plaintiff to purchase GateKeeper shares.
Press releases in 2012 and about imminent SEC audits and
filings parroted similar Press releases in 2009 and 2010.
Each of them coinciding with PPMs and share sales and market
2007 or 2008 Gatekeeper put out a Request for Proposals
(RFP), to which they received one (1) response (App. G Leon).
This response was from CSL the owner of the CAMS device. CSL
is an alias for Richard Sowden. Sowden is a friend and
associate of defendants known prior to the RFP (App. G
Seetoo. Wishart. Leon). This is not acknowledged in press
releases put out by the company, nor is the fact the CSL is
not a legitimate company (App. J pp.1-6).
Beginning around 2008 or 2009, Gatekeeper began the promotion
of Private Placement Offerings and the distribution of
Promotional Materials including Business Plans, Marketing
Documents, and PPMs (App. F) (App. H). Distribution of these
materials continued each year following until at least May
2015 (App F pp.50-51), nearly 18 months after this action
commenced, and a year after the SEC acted against Howard
Richards, an action which included the deposition of
Leontakianakos affixed in App. G of this document.
Gatekeeper also began to make public statements about
Gatekeeper's activities, prospects and plans, including
the purchase of companies, SEC auditing services, and
forthcoming moves from the Pink Sheets to the NASDAQ (App. F)
These public statements included press releases about the
CAMS device and the developer of the CAMS device, CSL, a
company James Wishart characterized as “world class
team of experts” (App. F pp.1-5, 14), and which he
indicated would “immediately”
“accelerate” manufacture of the CAMS device
There is no “world class tea of experts”
affiliated with CSL developing security technology for
Press releases also announced the purchase of a Company
called Bio Avenge, about which purchase Wishart is quoted
saying “This transaction has significantly increased
shareholder value as it has added a war chest of viable
assets.” (Id. pp.4-6).
Statements such coincided with market activity in the
publicly traded shares of GateKeeper and the distribution of
the PPMs (Id. pp.7, 12).
Gatekeeper also issued press releases about purchase orders
made by an organization called BACO, the value of which could
be in excess of “$300, 000, 000” and exclaimed
that the first “draw down” could take place
“within the next 30 days.” (Id. p.9).
Statements on Twitter and elsewhere by Gatekeeper further
stated that the CAMS technology was already on the market
(Id.pp.14, 41-46) and was aiding in the fight
against terrorism within the American Homeland
2010 Gatekeeper had accumulated multiple promissory letters
and wire transfer confirmation documents which showed
incoming investments totaling tens of millions of dollars
(App. K). And OTC filings in 2010 (App. K) and again in 2012
confirm this (App. K). In 2011, Gatekeeper even issued a
press release announcing the completion of $8 Million in
funding (Id. p.17) similar to the one in 2009 (App.
Gatekeeper continued issuing press releases and making public
statements about their activities, hiring Phoenix Partners to
pursue financing and arranging to conduct a Proof of Concept
(POC) for the purpose of attracting further investment in
Gatekeeper (App. F) In the press release, Gatekeeper CEO
James Wishart stated that Phoenix has an “impeccable
reputation as does its principal ” (App F pp.17-28,
again, in 2011 these same activities continued in an updated
and current iteration for that year, complete with Business
Plans, Marketing Materials an a new PPM (App A). At that
time, the Company represented that it would accept share
subscriptions “only from ‘accredited
investors' who satisfy the suitability standards”
under federal securities regulations and that upon completion
of the funding round all restricted legends on shares would
be removed and market liquidity would follow (App A.) Clearly
plaintiff was an unsophisticated investor, or he would have
taken one look at the last 5 years of PRs and asked
“where's the money?”
BACO is defunct in Texas, the state of its original
incorporation, and in Florida (App J pp.7-8), and was at the
time of Plaintiff's purchase despite the 2008 press
release touting the deal worth hundreds of millions remaining
at the Gatekeeper website for the public to see. When asked
about Larry Mael, the CEO of BACO, Gatekeeper CEO James
Wishart, who issued thepress release related to the $300,
000, 000 purchase order, did not even know Mael was (App. G
2010, Phoenix had been administratively dissolved by the
California Secretary of State for failure to pay taxes and
its principal, rather than having an “impeccable”
reputation, had previously been convicted of bank fraud and
served time in a Federal Penitentiary, facts withheld by
defendants from the public and the plaintiff (App J