SEC v. Imaging3, Inc. & Dean Janes, Case No. CV13-04616 GAF (AJWx) (C.D. Cal.). On June 26, 2013, the SEC announced it filed fraud charges against Imaging3, Inc. and its founder Dean Janes. Janes held a conference call with investors after the FDA denied clearance for Imaging3 to market one of its devices. This was the third time the FDA denied clearance citing safety concerns. The SEC alleges that Dean mislead investors by telling them that the FDA’s issues were “not substantive” and largely “administrative.” According to the SEC, Janes did not discuss the substantive safety concerns raised by the FDA about the device. Later, an investor got a copy of the FDA denial letter and publicized it. The SEC alleges that after the FDA letter was publicized, Janes used his Facebook page to mischaracterize the denial. The SEC charged Imaging3 and Janes with violations of Section 10(b) of the Exchange Act and Rule 10b-5(b). The SEC seeks injunctive relief, civil monetary penalties, and an order barring Janes from serving as an officer or director of a public company.
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