8-K

                SECURITIES AND EXCHANGE COMMISSION

                      Washington, D.C. 20509

                             FORM 8-K

                          CURRENT REPORT

  Pursuant to Section 13 or 15(d) of the Securities Exchange Act

                         October 17, 2006
                         ----------------
                          Date of Report
                (Date of Earliest Event Reported)

                       Sanguine Corporation
      (Exact Name of Registrant as Specified in its Charter)

       Nevada                     0-24480                  95-4347608
       ------                     -------                  ----------
(State or other juris-     (Commission File No.)        (IRS Employer
diction incorporation)                                     I.D. No.)

                        101 East Green Street, # 6
                        Pasadena, California 91105
                        --------------------------
                (Address of Principal Executive Offices)

                             (626)405-0079
                             -------------
                             Telephone No.

Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the Registrant under any of
the following provisions (see general instruction A.2. below):

     [ ] Written communications pursuant to Rule 425 under the Securities Act
         (17 CFR 230.425)

     [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
         (17 CFR 240.14a-12)

     [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
         Exchange Act (17 CFR 240.14d-2(b))

     [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
         Exchange Act (17 CFR 240.13e-4(c))


Item 8.01 Other Event.

On September 19, 2006, following receipt of comments from the Securities and
Exchange Commission related to our liability for the potential of failing to
file a registration statement regarding shares of our common stock underlying
certain outstanding warrants, David E. Nelson, our CFO, reviewed the possible
liability to us regarding the subject warrants that had been subsequently,
purchased by individuals closely associated with us.  After his review,
management concluded that there was a 10% probability that we may have been
unable to file the required registration statement timely and to keep it
effective during all periods that we were required to keep it effective, and
even though the registration statement was timely filed, we could have been
liable under the warrant net cash settlement agreement for an additional
obligation.

Because of managements conclusion, we decided to amended our Annual Report on
Form 10KSB/A-1 for the year ended December 31, 2005, and our Quarterly Reports
on Forms 10QSB/A-1 for the quarters ended March 31, 2006, and June 30, 2006,
to account for the potential risk of being unable to issue registered common
stock for the warrants if they were exercised. These filings were made on
October 17, 2006.  The potential liability is set forth in the letter of our
CFO, David E. Nelson, that is attached hereto and incorporated herein by
reference.  See Item 9.01  The these potential liabilities have only been
reflected in our aforesaid amended reports; accordingly, even though we
believe the potential liabilities reflected for other periods estimated are
not material, you may not be able to rely on our prior audit reports for the
calendar years ended December 31, 2004, 2003 and 2002, to the extent that
these potential liabilities are not reflected in our prior financial
statements for these calendar years then ended and the respective quarterly
periods during these calendar years, that amount to $64,341.01 for December
31, 2004; $2,813.75 for December 31, 2003; and $22,510 for December 31, 2002.

Item 9.01 Financial Statements and Exhibits.

         (a) Exhibits.

Description of Exhibit                          Exhibit Number
- ----------------------                          --------------

CFO Letter Dated September 19, 2006                99

                            SIGNATURES

Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this Current Report to be signed on its behalf by
the undersigned hereunto duly authorized.

                                 Sanguine Corporation

Date:10/18/06                    /s/ David E. Nelson
     --------                    ----------------------------
                                 David Nelson, CFO, Secretary
                                 Treasurer and Director

EX-99

September 19, 2006

Leonard Burningham
455 East 500 South, Suite 205
Salt Lake City, UT  84111

Dear Leonard,

     I have reviewed the possible liability for Sanguine Corporation with
regards to the warrants that were issued as part of the debenture to First
York Partners and subsequently, purchased by individuals closely associated
with Sanguine.  The following items were considered:

1.     Paragraph 8 of FASB 5 states.  An estimated loss from a loss
       contingency (as defined in paragraph 1) shall be accrued by a charge to
       income if both of the following conditions are met:

       a. Information available prior to issuance of the financial statements
          indicates that it is probable that an asset had been impaired or a
          liability had been incurred at the date of the financial statements.
          It is implicit in this condition that it must be probable that one
          or more future events will occur confirming the fact of the loss.

       b. The amount of loss can be reasonably estimated.

2.     Since the initial convertible debenture a significant percentage of the
       warrants originally issued have been converted.

3.     The remaining warrants are held primarily by individuals affiliated
       with the Company who are committed to increasing the value of the
       Company and therefore enhancing its stock value.  This enhances the
       probability that all the warrants will be exercised and the net cash
       settlement issue would be negated.

4.     Even though all of the warrant holders will probably exercise there
       warrants the Company cannot guarantee that all of the warrants will be
       exercised; or that the SEC will not in some remote way disallow the
       registration; or that by some unforeseen circumstances the Company does
       not keep the shares actively registered and the net cash settlement may
       be initiated.

     Below is an outline of the possible liability risk involved with this.

                             2002        2003          2004          2005

Warrants Outstanding       5,627,500   5,627,500     3,386,369     2,193,115
Exercise Price             $0.08       $0.08         $0.08         $0.08
Share Price at Year End     $0.04       $0.075        $0.27         $0.155
Price Difference          ($0.04)     ($0.005)       $0.19         $0.075
Possible Liability        ($225,100)  ($28,137.50)   $643,410.11   $164,483.63
10% Risk                  ($22,510)   ($2,813.75)    $64,341.01     $16,448.36
5% Risk                   ($11,255)   ($1,406.88)    $32,170.51      $8,224.18

     Based upon these factors management believes that there is a very remote
chance that a small percentage of warrant holders may request the net cash
settlement should events happen, that cause this to be a possibility.
Therefore, management to the best of its ability and in reviewing FAS 5 have
concluded that there is a 10% probability that the Company may be liable under
the warrant net cash settlement agreement for an additional obligation and
have recorded such liability on the books of the Company.

     Consider this Sanguine's Policy with regards to these warrants in future
and restated financial statements.

Very Truly Yours,

/s/ David E. Nelson
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David E. Nelson
Chief Financial Officer