2026-03-17 sec-litreleases judgment 143 KB 11,356 chars

SEC v. J. Bernard Rice, No. 2:23-cv-05379, Central District of California (Mar. 17, 2026) — Judgment

raw: SEC v. AMERICAN PATRIOT BRANDS

SEC v. AMERICAN PATRIOT BRANDS, No. 2:23-cv-05379 (Mar. 17, 2026)

Caption: Securities and Exchange Commission v. American Patriot Brands, Inc.

Enriched metadata

Scheme: corporate-fraud (95%)
Court: Central District of California
Case No.: 2:23-cv-05379
Disgorgement: $581,000
Civil penalty: $236,451

Classified corporate-fraud(confidence 95%). EDGAR detection: forms 10-K/10-Q/8-K· recall 56% / precision 8%. detection rule →

Extracted insights

Dollar amounts 4

$1.09M $1,089,328 $1M–$10M
$581K $581,000 $100K–$1M
$272K $271,877 $100K–$1M
$236K $236,451 $100K–$1M

Triples 8

Court found J. Bernard Rice violated Section 10(b) of the Exchange Act and Rule 10b-5 and Section 17(a) of the Securities Act
Court ordered Rice to be permanently restrained and enjoined from violating Section 10(b) of the Exchange Act and Rule 10b-5
Court ordered Rice to be permanently restrained and enjoined from violating Section 17(a) of the Securities Act
Rice is prohibited to employ any device, scheme, or artifice to defraud in connection with the purchase or sale of any security
Rice is prohibited to make any untrue statement of a material fact or to omit a material fact in connection with any security
Rice is prohibited to engage in any act, practice, or course of business that would operate as a fraud or deceit upon any person
Rice’s officers, agents, servants, employees, and attorneys are bound by the final judgment restraining Rice from violating the securities laws
Other persons in active concert or participation with Rice are bound by the final judgment restraining Rice from violating the securities laws

PDF

SEC v. AMERICAN PATRIOT BRANDS · Source

Text layers

Extracted body text (11,356c)

UNITED STATES DISTRICT COURT

CENTRAL DISTRICT OF CALIFORNIA

Western Division

SECURITIES AND EXCHANGE
COMMISSION,

Plaintiff,

AMERICAN PATRIOT BRANDS,
INC., et al.,

Defendants.

Case No. 2:23−cv−05379−AH−BFMx

FINAL JUDGMENT AS TO
DEFENDANT J. BERNARD RICE,
ONLY [137]

Defendant J. Bernard Rice (“Rice”) having been found by the Court to have

violated Section 10(b) of the Securities Exchange Act of 1934 (the “Exchange Act”)

[15 U.S.C. § 78j(b)] and Rule 10b-5 promulgated thereunder [17 C.F.R. § 240.10b-5]

and Section 17(a) of the Securities Act of 1933 (the “Securities Act”) [15 U.S.C.

§ 77q(a)]; having consented to the Court’s jurisdiction over him and the subject matter

of this action; having consented to entry of this Final Judgment; and having waived

any right to appeal from this Final Judgment:

IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that Rice is

permanently restrained and enjoined from violating, directly or indirectly, Section

10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5 promulgated

thereunder [17 C.F.R. § 240.10b-5], by using any means or instrumentality of interstate

commerce, or of the mails, or of any facility of any national securities exchange, in

connection with the purchase or sale of any security:

(a) to employ any device, scheme, or artifice to defraud;

(b) to make any untrue statement of a material fact or to omit to state a

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material fact necessary in order to make the statements made, in the light

of the circumstances under which they were made, not misleading; or

would operate as a fraud or deceit upon any person.

IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, as provided

in Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also binds the

following who receive actual notice of this Final Judgment by personal service or

otherwise: (a) Rice’s officers, agents, servants, employees, and attorneys; and (b) other

persons in active concert or participation with Rice or with anyone described in (a).

II.

IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that

Rice is permanently restrained and enjoined from violating Section 17(a) of the

Securities Act [15 U.S.C. § 77q(a)] in the offer or sale of any security by the use of any

means or instruments of transportation or communication in interstate commerce or by

use of the mails, directly or indirectly:

(a) to employ any device, scheme, or artifice to defraud;

(b) to obtain money or property by means of any untrue statement of a

material fact or any omission of a material fact necessary in order to make

the statements made, in light of the circumstances under which they were

made, not misleading; or

operates or would operate as a fraud or deceit upon the purchaser.

IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, as provided

in Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also binds the

following who receive actual notice of this Final Judgment by personal service or

otherwise: (a) Rice’s officers, agents, servants, employees, and attorneys; and (b) other

persons in active concert or participation with Rice or with anyone described in (a).

#:2427

III.

IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that

pursuant to Section 21(d)(5) of the Exchange Act [15 U.S.C. § 78u(d)(5)], Rice is

permanently restrained and enjoined from, directly or indirectly, including, but not

limited to, through any entity owned or controlled by him, participating in the

issuance, purchase, offer, or sale of any security provided, however, that such

injunction shall not prevent Rice from purchasing or selling securities for his own

personal accounts.

IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, as provided

in Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also binds the

following who receive actual notice of this Final Judgment by personal service or

otherwise: (a) Rice’s officers, agents, servants, employees, and attorneys; and (b) other

persons in active concert or participation with Rice or with anyone described in (a).

IV.

IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that,

pursuant to Section 21(d)(2) of the Exchange Act [15 U.S.C. § 78u(d)(2)] and Section

20(e) of the Securities Act [15 U.S.C. § 77t(e)], Rice is prohibited, for five (5) years

following the date of entry of this Final Judgment, from acting as an officer or director

of any issuer that has a class of securities registered pursuant to Section 12 of the

Exchange Act [15 U.S.C. § 78l] or that is required to file reports pursuant to Section

15(d) of the Exchange Act [15 U.S.C. § 78o(d)].

IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that

Rice is liable for disgorgement of $581,000, representing net profits gained as a result

of the conduct alleged in the Complaint, together with prejudgment interest thereon in

the amount of $271,877, and a civil penalty in the amount of $236,451 pursuant to

Section 20(d) of the Securities Act [15 U.S.C. § 77t(d)] and Section 21(d)(3) of the

Exchange Act [15 U.S.C. § 78u(d)(3)]. Rice shall satisfy this obligation by paying

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$1,089,328 to the Securities and Exchange Commission within 30 days after entry of

this Final Judgment.

Rice may transmit payment electronically to the Securities and Exchange

Commission, which will provide detailed ACH transfer/Fedwire instructions upon

request. Payment may also be made directly from a bank account via Pay.gov through

the SEC website at http://www.sec.gov/about/offices/ofm.htm. Rice may also pay by

certified check, bank cashier’s check, or United States postal money order payable to

the Securities and Exchange Commission, which shall be delivered or mailed to

Enterprise Services Center
Accounts Receivable Branch
6500 South MacArthur Boulevard
Oklahoma City, OK 73169

and shall be accompanied by a letter identifying the case title, civil action number, and

name of this Court; the identification of Rice as a defendant in this action; and

specifying that payment is made pursuant to this Final Judgment.

Rice shall simultaneously transmit photocopies of evidence of payment and case

identifying information to the Commission’s counsel in this action. By making this

payment, Rice relinquishes all legal and equitable right, title, and interest in such funds

and no part of the funds shall be returned to Rice.

The Commission may enforce the Court’s judgment for disgorgement and

prejudgment interest by using all collection procedures authorized by law, including,

but not limited to, moving for civil contempt at any time after 30 days following entry

of this Final Judgment.

The Commission may enforce the Court’s judgment for penalties by the use of

all collection procedures authorized by law, including the Federal Debt Collection

Procedures Act, 28 U.S.C. § 3001 et seq., and moving for civil contempt for the

violation of any Court orders issued in this action. Rice shall pay post judgment

interest on any amounts due after 30 days of the entry of this Final Judgment pursuant

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to 28 U.S.C. § 1961. The Commission shall hold the funds, together with any interest

and income earned thereon (collectively, the “Fund”), pending further order of the

Court.

The Commission may propose a plan to distribute the Fund subject to the

Court’s approval. Such a plan may provide that the Fund shall be distributed pursuant

to the Fair Fund provisions of Section 308(a) of the Sarbanes-Oxley Act of 2002. The

Court shall retain jurisdiction over the administration of any distribution of the Fund

and the Fund may only be disbursed pursuant to an Order of the Court.

Regardless of whether any such Fair Fund distribution is made, amounts ordered

to be paid as civil penalties pursuant to this Judgment shall be treated as penalties paid

to the government for all purposes, including all tax purposes. To preserve the

deterrent effect of the civil penalty, Rice shall not, after offset or reduction of any

award of compensatory damages in any Related Investor Action based on payment of

disgorgement in this action, argue that he is entitled to, nor shall he further benefit by,

offset or reduction of such compensatory damages award by the amount of any part of

Rice’s payment of a civil penalty in this action (“Penalty Offset”). If the court in any

Related Investor Action grants such a Penalty Offset, Rice shall, within 30 days after

entry of a final order granting the Penalty Offset, notify the Commission’s counsel in

this action and pay the amount of the Penalty Offset to the United States Treasury or to

a Fair Fund, as the Commission directs. Such a payment shall not be deemed an

additional civil penalty and shall not be deemed to change the amount of the civil

penalty imposed in this Judgment. For purposes of this paragraph, a “Related Investor

Action” means a private damages action brought against Rice by or on behalf of one or

more investors based on substantially the same facts as alleged in the Complaint in this

action.

VI.

IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that

the Consent of J. Bernard Rice is incorporated herein with the same force and effect as

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if fully set forth herein, and that Rice shall comply with all of the undertakings and

agreements set forth therein.

VII.

IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that,

for purposes of exceptions to discharge set forth in Section 523 of the Bankruptcy

Code, 11 U.S.C. § 523, the allegations in the Complaint are true and admitted by Rice,

and, further, any debt for disgorgement, prejudgment interest, civil penalty, or other

amounts due by Rice under this Final Judgment or any other judgment, order, consent

order, decree or settlement agreement entered in connection with this proceeding, is a

debt for the violation by Rice of the federal securities laws or any regulation or order

issued under such laws, as set forth in Section 523(a)(19) of the Bankruptcy Code, 11

U.S.C. § 523(a)(19).

VIII.

IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that this Court

shall retain jurisdiction of this matter for the purposes of enforcing the terms of this

Final Judgment.

IX.

There being no just reason for delay, pursuant to Rule 54(b) of the Federal Rules

of Civil Procedure, the Clerk is ordered to enter this Final Judgment forthwith and

without further notice.

Dated: MARCH 13, 2026 __________________________________
HON. ANNE HWANG
UNITED STATES DISTRICT JUDGE

#:2431

OCR text (12,291c · textlayer · 95% conf)

UNITED STATES DISTRICT COURT

CENTRAL DISTRICT OF CALIFORNIA

Western Division

SECURITIES AND EXCHANGE
COMMISSION,

Plaintiff,

AMERICAN PATRIOT BRANDS,
INC., et al.,

Defendants.

Case No. 2:23−cv−05379−AH−BFMx

FINAL JUDGMENT AS TO
DEFENDANT J. BERNARD RICE,
ONLY [137]

Defendant J. Bernard Rice (“Rice”) having been found by the Court to have

violated Section 10(b) of the Securities Exchange Act of 1934 (the “Exchange Act”)

[15 U.S.C. § 78j(b)] and Rule 10b-5 promulgated thereunder [17 C.F.R. § 240.10b-5]

and Section 17(a) of the Securities Act of 1933 (the “Securities Act”) [15 U.S.C.

§ 77q(a)]; having consented to the Court’s jurisdiction over him and the subject matter

of this action; having consented to entry of this Final Judgment; and having waived

any right to appeal from this Final Judgment:

IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that Rice is

permanently restrained and enjoined from violating, directly or indirectly, Section

10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5 promulgated

thereunder [17 C.F.R. § 240.10b-5], by using any means or instrumentality of interstate

commerce, or of the mails, or of any facility of any national securities exchange, in

connection with the purchase or sale of any security:

(a) to employ any device, scheme, or artifice to defraud;

(b) to make any untrue statement of a material fact or to omit to state a

Case 2:23-cv-05379-AH-BFM Document 139 Filed 03/13/26 Page 1 of 6 Page ID
#:2426

material fact necessary in order to make the statements made, in the light

of the circumstances under which they were made, not misleading; or

would operate as a fraud or deceit upon any person.

IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, as provided

in Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also binds the

following who receive actual notice of this Final Judgment by personal service or

otherwise: (a) Rice’s officers, agents, servants, employees, and attorneys; and (b) other

persons in active concert or participation with Rice or with anyone described in (a).

II.

IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that

Rice is permanently restrained and enjoined from violating Section 17(a) of the

Securities Act [15 U.S.C. § 77q(a)] in the offer or sale of any security by the use of any

means or instruments of transportation or communication in interstate commerce or by

use of the mails, directly or indirectly:

(a) to employ any device, scheme, or artifice to defraud;

(b) to obtain money or property by means of any untrue statement of a

material fact or any omission of a material fact necessary in order to make

the statements made, in light of the circumstances under which they were

made, not misleading; or

operates or would operate as a fraud or deceit upon the purchaser.

IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, as provided

in Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also binds the

following who receive actual notice of this Final Judgment by personal service or

otherwise: (a) Rice’s officers, agents, servants, employees, and attorneys; and (b) other

persons in active concert or participation with Rice or with anyone described in (a).

Case 2:23-cv-05379-AH-BFM Document 139 Filed 03/13/26 Page 2 of 6 Page ID
#:2427

III.

IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that

pursuant to Section 21(d)(5) of the Exchange Act [15 U.S.C. § 78u(d)(5)], Rice is

permanently restrained and enjoined from, directly or indirectly, including, but not

limited to, through any entity owned or controlled by him, participating in the

issuance, purchase, offer, or sale of any security provided, however, that such

injunction shall not prevent Rice from purchasing or selling securities for his own

personal accounts.

IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that, as provided

in Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also binds the

following who receive actual notice of this Final Judgment by personal service or

otherwise: (a) Rice’s officers, agents, servants, employees, and attorneys; and (b) other

persons in active concert or participation with Rice or with anyone described in (a).

IV.

IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that,

pursuant to Section 21(d)(2) of the Exchange Act [15 U.S.C. § 78u(d)(2)] and Section

20(e) of the Securities Act [15 U.S.C. § 77t(e)], Rice is prohibited, for five (5) years

following the date of entry of this Final Judgment, from acting as an officer or director

of any issuer that has a class of securities registered pursuant to Section 12 of the

Exchange Act [15 U.S.C. § 78l] or that is required to file reports pursuant to Section

15(d) of the Exchange Act [15 U.S.C. § 78o(d)].

IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that

Rice is liable for disgorgement of $581,000, representing net profits gained as a result

of the conduct alleged in the Complaint, together with prejudgment interest thereon in

the amount of $271,877, and a civil penalty in the amount of $236,451 pursuant to

Section 20(d) of the Securities Act [15 U.S.C. § 77t(d)] and Section 21(d)(3) of the

Exchange Act [15 U.S.C. § 78u(d)(3)]. Rice shall satisfy this obligation by paying

Case 2:23-cv-05379-AH-BFM Document 139 Filed 03/13/26 Page 3 of 6 Page ID
#:2428