U. S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 16255 / August 19, 1999
SECURITIES AND EXCHANGE COMMISSION v. DAVID A. COLVIN; INTELLINET PUBLISHING, INC.; INTELLINET HOLDING GROUP, INC.; MEDICAL ADVANTAGE, INC.; LAMELLI, INC. a/k/a LAMELLI MEDICAL TECHNOLOGY, INC.; WALL STREET RESEARCH COMPANY, INC.; JOB KJELL HOVIK; LAMAR ELLIS; and JOHN LARSON a/k/a JOHN ST. JOHN, Civil Action No. SA98-135 AHS (EEx) (C.D. Cal.)
On August 16, 1999, the Honorable Alicemarie H. Stotler, United States District Judge for the Central District of California, granted the Commission's motion for judgment of civil contempt against Defendants David A. Colvin ("Colvin"), Job Kjell Hovik ("Hovik") and John Larson a/k/a John St. John ("Larson"). Judge Stotler found these Defendants in contempt of the provisions of the Court's April 14, 1999, final judgment requiring them to disgorge monies they received from defrauded investors. The Court found that none of the three Defendants had paid any portion of the ordered disgorgement, or made the required showing of inability to pay. Accordingly, Defendants Colvin and Larson, who appeared at the contempt hearing, were immediately taken into custody. The Court issued a bench warrant for the arrest of Hovik, and granted the Commission's motion that he be required to surrender his passport until he pays the full amount of disgorgement or until he makes the required showing of inability to pay.
Defendant Colvin had been ordered by the final judgment to disgorge $939,459 plus interest; Hovik had been ordered to disgorge $397,265.50 plus interest; and Larson had been ordered to disgorge $224,513 plus interest.
In granting the Commission's motion for summary judgment on April 14, 1999, Judge Stotler had found that the Defendants had made numerous fraudulent representations in offering and selling unregistered securities, including through Internet Web sites. Among other things, in offering and selling securities of the various corporate defendants, certain of the Defendants and various salespeople falsely represented that former U.S. Surgeon General C. Everett Koop and television journalist Tom Brokaw were affiliated with Defendant Medical Advantage, Inc.
The Defendants, operating out of offices in the San Fernando Valley in Southern California, raised over $5.6 million from hundreds of investors nationwide from January 1997 until the Commission filed its action and obtained a temporary restraining order, asset freeze order and appointment of a receiver over the entity Defendants on February 20, 1998.
For additional information, see Litigation Release Nos. 15551 (February 24, 1998), 15683 (March 25, 1998), and 16142 (May 14, 1999).