Court Holds CEO of Development Stage Company in Contempt for Failing to Comply with a Court Order Enforcing an SEC Investigative Subpoena
Litigation Release No. 24047 / February 14, 2018
Securities and Exchange Commission v. Terrence LeGall, No. 17-Misc-291 (S.D.N.Y.)
On December 26, 2017, Judge Ronnie Abrams of the United States District Court for the Southern District of New York issued an order finding Terrence LeGall, the CEO of LeGall Holdings, Inc., a development stage company incorporated in Delaware that purports to specialize in Caribbean and American cuisine, to be in civil contempt of court for failing to comply with the court's prior order enforcing an SEC investigative subpoena directed to Terrence LeGall.
The SEC is investigating, among other things, whether LeGall Holdings, Inc. and others may have made false statements of material fact or failed to disclose material facts in connection with LeGall Holdings, Inc.'s public filings. On June 12, 2017, the SEC issued an investigative subpoena to Terrence LeGall requiring him to produce certain documents and appear for testimony. However, Terrence LeGall failed to produce any documents, appear for testimony, or otherwise respond to the subpoena.
The SEC filed this subpoena enforcement action on August 7, 2017, and on September 13, 2017, the court entered an order requiring Terrence LeGall to comply with the SEC subpoena. Terrence LeGall failed to comply with the court's order, and, after holding a hearing on December 18, 2017, the court held Terrence LeGall in civil contempt. The court ordered Terrence LeGall arrested and incarcerated until he purges himself of the court's contempt by complying with the subpoena enforcement order.
The SEC is continuing its fact-finding investigation and to date has not concluded that anyone has violated the securities laws.