The Securities and Exchange Commission has sued three people for manipulating the stock of Stan Lee Media, an online entertainment company founded by the comic book legend that collapsed in late 2000.
The SEC sued company co-founder Peter Paul, former senior operations executive Stephen Gordon; and stock broker Jeffrey Pittsburg in federal court in Los Angeles. The lawsuit alleges that between early October and late November 2000, they manipulated the market for the company’s stock. The three also face criminal charges in New York for securities fraud.
Stan Lee, the driving force behind the development of Spider-Man, X-Men, The Incredible Hulk, and many other popular Marvel Comics superheroes, is now involved with another public company, POW! Entertainment, as its chief creative officer. He was not implicated in the SEC probe of Stan Lee Media, which filed for bankruptcy protection In February 2001.
Gordon, without admitting or denying guilt, has agreed to a settlement that bars him from future violations of securities laws and from serving as an officer or director of a public company. Last August he was sentenced to 6-1/2 years in federal prison after convictions in Los Angeles on charges of wire and bank fraud for writing bad checks to buy Stan Lee Media stock, Reuters reported. The news service wasn’t able to obtain comment from lawyers for Paul and Pittsburg.
The SEC charged Paul and Gordon with attempting to buy Stan Lee Media stock with checks that bounced and with selling company shares at below-market prices. It alleged that Pittsburg kept the price for Stan Lee Media shares high through the use of an electronic communications network. In this way, he allegedly disguised the fact that virtually all of the demand for Stan Lee Media stock was coming from his firm, Pittsburg Institutional.
The SEC is seeking orders barring the three from securities-law breaches and wants to force Pittsburg to disgorge his income from the arrangement.