SEC v. INTRUSION INC., No. 4:23-cv-00859, Eastern District of Texas (Sept. 26, 2023) — Complaint

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF TEXAS
SHERMAN DIVISION

SECURITIES AND EXCHANGE COMMISSION,

    Plaintiff,

v.

INTRUSION INC.,

    Defendant.

Civil Action No.  4:23-cv-859

COMPLAINT
Plaintiff Securities and Exchange Commission (“SEC”) files this Complaint against
Defendant Intrusion Inc. (“Intrusion” or the “Company”), and alleges as follows:
SUMMARY
1. Intrusion is a publicly traded cybersecurity company. Beginning in May 2020, the
Company—primarily through its president, CEO, and director at the time (“Former CEO”)—
began promoting a new cybersecurity product that it called “Intrusion Shield” (“Shield”). From
May 2020 through May 2021, in press releases, earnings calls, interviews, and other statements,
Intrusion, through the Former CEO, made materially false and misleading statements regarding:
(a) the Former CEO’s background and experience; (b) the Company’s success in marketing
Shield to participants in its beta testing program; and (c) certain Company contracts, or purported
contracts, with prospective customers. Intrusion’s conduct violated the antifraud, current
reporting, and disclosure controls and procedures provisions of the federal securities laws.
JURISDICTION AND VENUE
2. The Court has jurisdiction over this action under Sections 20(b), 20(d), and 22 of
the Securities Act of 1933 (“Securities Act”) [15 U.S.C. §§ 77t(b), 77t(d), and 77v] and Sections

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21(d), 21(e), and 27 of the Securities Exchange Act of 1934 (“Exchange Act”) [15 U.S.C. §§
78u(d), 78u(e), and 78aa]. Intrusion directly or indirectly made use of means or instrumentalities
of interstate commerce, or of the mails, or the facilities of a national securities exchange, in
connection with the transactions, acts, practices, and courses of business alleged herein.
3. Venue in this district is proper under Section 22 of the Securities Act [15 U.S.C. §
77v] and Section 27 of the Exchange Act [15 U.S.C. § 78aa] because certain acts, practices,
transactions, and courses of business constituting the violations alleged herein occurred within
this district.
DEFENDANT
4. Intrusion is a Delaware corporation with its principal place of business in Plano,
Texas. Intrusion’s common stock trades under the ticker symbol INTZ on the Nasdaq Capital
Market and has been registered with the SEC pursuant to Section 12(b) of the Exchange Act
since October 8, 2020. Prior to that date, the Company’s common stock was registered with the
SEC pursuant to Section 12(g) of the Exchange Act. Intrusion is required to file periodic and
current reports with the SEC pursuant to Section 13(a) of the Exchange Act and the related rules
thereunder.
FACTS
Intrusion’s Background and its Launch of Shield
5.  Until 2020, Intrusion sold cybersecurity consulting services and two
cybersecurity products that detected, analyzed, and reported cyberattacks or misuse of
information. Intrusion’s customers during this time included government defense and security
agencies and two commercial customers (“Customer A” and “Customer B”). In 2018 and 2019,
Intrusion had a small net income because of large, one-time contracts, but operated at a loss the

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prior four years. In May 2020, following the death of Intrusion’s co-founder and longtime chief
executive, the Company appointed the Former CEO.
6. The Former CEO worked with the Company’s engineers to develop Shield, which
was largely based on Intrusion’s existing products with certain additional enhancements and
functionality. After commercial launch of Shield in January 2021, Intrusion offered Shield as a
software-as-a-service product at $20 per “seat” (essentially per user), per month with no annual
contract requirement.
Intrusion’s Former CEO Reshaped the Company’s Culture
7. Upon being appointed to the CEO position in May 2020, the Former CEO
changed the Company’s previously cautious and fiscally conservative culture. He persuaded
Intrusion’s board of directors to appoint his longtime friend and former colleague as a director
and, shortly thereafter, as chairman, and he essentially forced out or fired some of the
Company’s senior leadership. Under the Former CEO, Intrusion expanded rapidly, growing from
approximately 30 employees to 110.
Intrusion’s False and Misleading Statements

8. Beginning with his appointment in May 2020, the Former CEO used his forceful,
assertive style to tout his background and experience and to promote Shield as a cybercrime
prevention tool. During these promotional efforts, Intrusion made numerous false and misleading
statements (discussed in detail below), which were authored and/or approved by the Former
CEO.
Intrusion Misrepresents the Former CEO’s Background

9. Intrusion made false and misleading statements regarding the Former CEO’s
cybersecurity and public company experience. The Company issued a press release on May 27,
2020 (and a purportedly corrective press release on May 29, 2020) announcing the appointment

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of its new CEO (the Former CEO), which claimed that he had served as a director of five public
companies. The May 29, 2020 press release also stated that the Former CEO had served as CIO
(chief information officer) of the U.S. Department of Agriculture (“USDA”). Neither statement
was true.
10. First, the Former CEO had served on, at most, four public company boards. One
of those four companies was not a U.S. public company, a second never identified him as a
director in its public filings, and his tenure on a third company’s board lasted less than four
months. In addition to the Company’s May 2020 press releases, Intrusion also included the false
and misleading statement regarding the Former CEO’s public company experience in: (a) its
Forms S-1 and S-1/  A filed with the SEC in August and October 2020, respectively; (b) the
prospectus for its October 2020 securities offering; and (c) its April 5, 2021 proxy statement.
11. Second, the Former CEO was never the CIO of the USDA. He did hold the
position of director of the Information Technology Services Division within the National Finance
Center, a subdivision of the USDA. In that position, he reported to the chief financial officer of
the National Finance Center, which primarily provides payroll processing and other financial and
personnel services to the USDA and other federal agencies. The Former CEO repeated the false
and misleading claim about serving as the CIO of the USDA in an October 2020 public offering
roadshow presentation and a January 2021 investor conference presentation; both presentations
were attached as exhibits to Forms 8-K filed by the Company with the SEC and signed by the
Former CEO. Similarly, in an April 2021 radio interview, the Former CEO falsely and
misleadingly stated that “... I was a CIO in the federal government a few years ago, fighting the
Russians and Chinese for our entire federal government....” Although the National Finance
Center provided payroll services to many federal agencies, the Former CEO was not the CIO of
the USDA and did not serve the entire federal government in his USDA position. Intrusion’s

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false and misleading statements regarding the Former CEO’s background were material because
they led investors to believe that the Company’s most senior leader was more qualified,
experienced, and accomplished than he actually was.
Intrusion Overstates its Success Marketing Shield to Beta Testers
12. During the fall of 2020, Intrusion solicited potential customers to evaluate and test
Shield, a process referred to as beta testing. Thirteen companies participated in the beta test,
including: (a) Intrusion’s public relations firm; (b) Intrusion’s securities offering underwriter; (c)
a company whose CIO was the Former CEO’s son-in-law; (d) an investment adviser that
invested in Intrusion; and (e) Customer B, whose chairman was an Intrusion board member.
Despite Intrusion’s ties to several of the participants, only six of the 13 beta testers ultimately
purchased Shield. As set forth below, Intrusion made statements over the course of several
months that misrepresented the beta testing program.
13. First, Intrusion misrepresented the companies that were beta testing Shield. In a
written roadshow presentation to promote the Company’s October 2020 public securities
offering, which was included as an exhibit to Intrusion’s October 5, 2020 Form 8-K filed with
the SEC, Intrusion claimed that Shield had “[v]alidation from early adoption by [a] Fortune 100
beta customer.” However, none of the beta testers was a Fortune 100 company.
14. Further, Intrusion misrepresented its success in converting beta test participants
into paying Shield customers. On January 13, 2021, the Former CEO approved an Intrusion press
release, attached as an exhibit to a Form 8-K filed by the Company with the SEC and signed by
the Former CEO, stating that “[a]ll of the companies participating in the beta program have made
the decision to move forward with Shield in production.” The press release also quoted
representatives of three of the beta testers, including the CIO of Intrusion’s securities
underwriter. The same day (January 13, 2021), the Former CEO made a presentation at a

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securities conference that included the claim that Shield had “[v]alidation from early adoption by
12 ‘beta’ customers.” The presentation materials were also attached as an exhibit to the
Company’s January 13, 2021 Form 8-K filed with the SEC. Intrusion’s stock price closed at
$23.88 per share on January 13, 2021, up more than 18.5% from the prior day’s closing price,
and its trading volume increased more than 30% from the day before.
15. The January 13, 2021 press release issued by Intrusion was false and misleading.
By that date, none of the beta testers had purchased Shield. In fact, when the Company issued the
press release, the Former CEO—who received regular updates regarding the beta testing—knew
that several participants had not moved forward beyond the beta testing stage. For example, just
days prior to the press release, the CIO of Intrusion’s underwriter told the Former CEO that the
underwriter would continue testing Shield because the product had not yet functioned on the
underwriter’s primary network. Moreover, the underwriter’s CIO, who was quoted in the press
release, had not given Intrusion approval to be quoted in the Company’s January 13, 2021 press
release. Hours after the press release was published, the underwriter objected to Intrusion and the
Company’s investor relations firm regarding the unauthorized quotation of its CIO, as well as to
the statement that all beta testers were moving forward into production.
16. The next day, January 14, 2021, Intrusion issued a purportedly corrective press
release that replaced the quote from the underwriter’s CIO and stated that “[m]ost companies
participating in the beta program are migrating to the production phase of Shield.” However, this
press release continued to materially overstate and misrepresent Intrusion’s success in marketing
Shield to its beta testers, as only one company involved in the beta testing had signed a contract
at the time the Company issued the January 14, 2021 press release.
17. After the January 2021 press releases, the Former CEO continued to
misrepresent—both to investors and to Intrusion’s board—the Company’s success in marketing

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Shield to the beta testers. Despite receiving a number of contemporaneous updates showing that
only three of the beta testers had signed contracts, the Former CEO told the Company’s board on
February 4, 2021 that “[m]ost Beta Customers have converted to paying customers.” Later that
month, the Former CEO, referencing the January 2021 press releases, told an investor in an email
that all beta testers other than the underwriter were “now under 1 or 3 year contracts.” And
during the Company’s February 25, 2021 earnings call, Intrusion’s CEO stated that “90% of our
beta customers became paying subscribers on the Shield.”
18. The day after the earnings call Intrusion’s stock price closed at $24.38, up almost
30% from the prior day’s close, and its trading volume increased approximately 629% from the
day before. However, all of these claims regarding Shield’s beta testing success were false and
misleading. As of February 25, 2021, only three of the 13 beta testers had signed contracts for
Shield, while three of the beta testers had indicated they would not purchase it. Finally, despite
an April 2021 update to the Former CEO showing that only five beta testers had been “won,”
Intrusion’s presentation materials displayed at the Company’s May 18, 2021 shareholder meeting
falsely stated that “[m]ost Beta Customers have converted to paying customers.”  Intrusion’s false
and misleading statements regarding the beta testing program were material because they
misstated and/or overstated the Company’s success in marketing Shield, a product that was
crucial to both the Company’s near-term and long-term financial condition.
Intrusion Misleads Investors about its Contract with Customer A
19. In early 2021, the Former CEO began to prime the market to expect one or more
major Shield contracts. For example, during the February 25, 2021 earnings call, the Former
CEO touted interest in Shield from large corporations, referencing Fortune 100 and 500
companies that were evaluating or testing Shield. Then, on March 31, 2021, Intrusion issued a
press release announcing that Customer A had signed an agreement to protect its network using

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Shield. However, the actual terms of that agreement provided for a renewal of an existing
contract with Customer A for other Intrusion services (not including Shield), for three years at
the same price, as well as for Intrusion to provide Shield for free for three years, with an option
for Customer A to renew Shield for another three years at a 93 percent discount. The press
release, which referenced Customer A’s 46,000 employees worldwide, did not include any
information regarding the specific terms of the contract.
20. The March 31, 2021 press release was materially misleading because it omitted
that Customer A did not pay for Shield (and had no obligation to ever pay for or use this
product). Intrusion’s stock price closed approximately 19% higher than the prior trading day
after the Company issued the March 31, 2021 press release, and its trading volume increased
approximately 113% from the day before. Two industry analysts who followed Intrusion’s stock
issued positive reports shortly thereafter, estimating, based on Intrusion’s publicized seat pricing
for Shield, over $5 million in potential annual revenues from the Customer A contract—an
amount greater than 75% of Intrusion’s total 2020 revenues of $6.6 million.
21. Thereafter, Intrusion, through statements made and/or approved by the Former
CEO, frequently and prominently referenced the Customer A contract as a Shield-adoption
success story. Intrusion not only remained silent regarding the fact that Customer A received
Shield for free, but in some instances the Company implied, or even stated, that Customer A was
paying for Shield:
• In an April 13, 2021 press release, Intrusion announced that Shield was
“protecting over 50,000 seats,” and referenced Customer A signing on as a Shield
customer. On April 13, 2021, Intrusion’s stock price closed at $28.25, up more
than 19% from the prior day. Yet, at the time of this press release, Intrusion only
had signed contracts for 550 paid seats.

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• In an April 20, 2021 email, the Former CEO told a YouTube finance and
technology commentator that all 50,000 seats referenced in the April 13 press
release were paid.
• In an April 22, 2021 press release refuting a negative research report about
Intrusion and Shield, Intrusion again referenced its multi-year agreement with
Customer A without disclosing that Customer A was not paying for Shield.
• During the Company’s May 4, 2021 earnings call, the Former CEO specifically
referenced Customer A when lauding what he described as the Company’s
“extraordinary success” in licensing over 50,000 seats for Shield. He went on to
explain Intrusion’s lack of first quarter revenues attributable to Shield by pointing
to Intrusion’s new contract with Customer A to illustrate that Intrusion only
received revenue as seats were implemented, saying “[s]o the revenues will come
in as they bring on a territory or region and then the revenue start paying.” In
truth, however, Customer A was not obligated to pay for Shield.
• In a May 10, 2021 YouTube interview with a financial newsletter publisher, the
Former CEO discussed the Company’s seat pricing for Shield, stating: “So, we
are very profitable at $20.00 per seat. It obviously adds up. If you’re a Fortune
500 with [Customer A], you know, with thousands and thousands of end users,
that becomes a pretty big number pretty fast.” However, Customer A was not, in
fact, paying for Shield (nor was it obligated to), so its contract would not add “a
pretty big number” to Intrusion’s sales or income.
22. Similarly, Intrusion also made false and misleading statements about the status of
Customer A’s adoption of Shield. In an April 8, 2021 radio interview, the Former CEO said that
the Company had installed Shield worldwide for Customer A. And during Intrusion’s May 4,

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2021 earnings call, the Former CEO claimed that Customer A already had Shield seats
implemented by the time of the Company’s March 31, 2021 press release. When the Former
CEO made these statements, however, Customer A had no Shield appliances on its network.
Rather, Customer A’s cyber defense officer was testing Shield at his residence on his home
network.
23. During the Company’s May 4, 2021 earnings call, the Former CEO also referred
to the work that Customer A had conducted to evaluate Shield, stating that it was a major
enterprise decision and that “this is as good of a rubber stamp as you can get that says certified,
ready for production.” But, as the Former CEO knew, Customer A did not test or evaluate any
Shield appliance prior to entering into the contract. In fact, in late March 2021, Customer A’s
cyber defense officer told the Former CEO that Customer A had not run Shield on its network.
24. The Former CEO understood the importance of the fact that Intrusion had given
Shield to Customer A for free, as demonstrated by the numerous steps he took to conceal the
contract’s actual terms from the public (as described above) and from Intrusion’s board and
executives. For example, the Former CEO refused to tell Intrusion’s chief sales officer the
pricing terms of the Customer A deal. Additionally, the Former CEO told the Company’s then
CFO that the details of the Customer A contract should not be shared with anyone, saying: “I
mean nobody. You, me and the board. That’s it.” Despite this statement, the Former CEO also
kept the board in the dark. He falsely told Intrusion’s chairman and another director that the
Customer A Shield contract provided additional revenue to Intrusion, when, in fact, it did not.
The Former CEO also resisted repeated requests from directors to see the Customer A contract
until June 2021, when he finally allowed the chairman to see the Customer A contract.
Intrusion’s false and misleading statements regarding the Customer A contract were material

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because they misstated and/or overstated the Company’s success in marketing Shield, a product
that was crucial to both the Company’s near-term and long-term financial condition.
Intrusion Misrepresents Two More Customer Relationships
25. Intrusion also made false and misleading statements about the Company’s
arrangements with two other businesses. On April 6, 2021, Intrusion issued a press release
announcing that Customer B had “signed an agreement” for Shield, which quoted a Customer B
executive. Intrusion made nearly identical claims about Customer B in an April 13, 2021 press
release (referenced above in paragraph 21 in connection with the Company’s Customer A
contract misrepresentations) and in an April 22, 2021 press release issued to refute a negative
research report (also referenced above in paragraph 21).
26. Although Customer B had indicated an interest in purchasing Shield in March
2021, it did not sign a contract until early May 2021, after it negotiated a larger discount for the
product. The Former CEO led Intrusion’s negotiations with Customer B until mid-April 2021
and knew that Customer B objected to Intrusion’s proposed pricing. He also knew that Intrusion
had not received a signed agreement from Customer B. Nonetheless, the Former CEO authorized
the April 6, 2021 press

release.
27. Intrusion also made misleading statements about the Company’s relationship with
a New Orleans-based government contractor (“Customer C”). In the April 13, 2021 press release,
Intrusion claimed that it had finished the first quarter “with several key wins” and referenced
customers, including Customer C, adopting Shield to protect their networks. Later, during the
Company’s May 4, 2021 earnings call, the Former CEO emphasized the rapid evaluation and
implementation of Shield by telling a story about a demonstration he did for a New Orleans
contractor. The Former CEO stated that he demonstrated Shield and the contractor “bought the
product the same day.” The Former CEO also claimed that when he jokingly said he could take

 12
Shield back with him, the customer’s CIO said, “you’re never getting that appliance out of my
network” and that he would sign the contract that day.
28. The Former CEO admitted under oath that the firm referenced during the May 4,
2021 earnings call was Customer C. However, Customer C did not sign a contract for Shield. In
fact, when the Former CEO offered Shield for testing to Customer C’s CEO (who was a friend)
in late March 2021, the Former CEO actually told him, “[y]ou don’t have to sign a contract.”
And after he was fired by Intrusion in July 2021, the Former CEO told his friend that he was the
only one at the Company who knew that Customer C was testing Shield and suggested that
Customer C return Shield to avoid being charged. Intrusion’s false and misleading statements
regarding the purported contracts with Customer B and Customer C were material because they
misstated and/or overstated the Company’s success in marketing Shield, a new product that was
crucial to both the Company’s near-term and long-term financial condition.
Intrusion Terminates the Former CEO
29. As described in paragraph 24 above, the Company’s chairman learned in early
June 2021 that, contrary to the Former CEO’s prior representations to him, Intrusion had actually
provided Shield to Customer A for free. Around that time, the chairman also learned that
Intrusion’s beta tester conversion rate was much lower than the Former CEO had claimed and
that the Company had far exceeded its budgeted hiring. On July 19, 2021, Intrusion’s board
terminated the Former CEO’s employment.
Intrusion Lacked Disclosure Controls and Procedures
30. From at least May 2020 through July 2021, Intrusion had minimal and ineffective
disclosure controls and procedures. For example, Intrusion lacked procedures to ensure that
information was communicated to management to allow timely decisions regarding required and

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accurate disclosures. Additionally, the controls or procedures that Intrusion had for its press
releases and other current reports were informal, unwritten, and not consistently implemented.
Intrusion Offered and Sold Securities
31. On August 25, 2020, Intrusion filed an offering registration statement with the
SEC on Form S-1 seeking to register the sale of up to 3,565,000 shares of its common stock. An
amended Form S-1 was declared effective on October 8, 2020, and thereafter Intrusion sold stock
to the public. Intrusion also registered the offer and sale of common stock pursuant to an
employee compensation plan on Form S-8 on May 7, 2018. The Company’s false and misleading
statements (described above in paragraphs 9 through 28) occurred during Intrusion’s offer and
sale of its common stock to the public and/or its employees.
FIRST CLAIM FOR RELIEF
Intrusion Violated Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Exchange
Act Rule 10b-5 [17 C.F.R. § 240.10b-5]
32. The SEC realleges and incorporates by reference each and every allegation
contained in the paragraphs above.
33. By engaging in the acts and conduct alleged herein, Intrusion, directly or
indirectly, in connection with the purchase or sale of a security, by the use of any means or
instrumentality of interstate commerce, or of the mails or of any facility of any national securities
exchange, knowingly or with severe recklessness:
  (a) employed a device, scheme, or artifice to defraud; and/or
(b) made an untrue statement of material fact, or omitted to state a material
fact necessary in order to make the statements made, in light of the
circumstances under which they were made, not misleading; and/or

 14
(c) engaged in an act, practice, or course of business which operated or would
operate as a fraud or deceit upon any person.
34. By reason of the foregoing, Intrusion violated, and unless enjoined will continue
to violate, Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Exchange Act Rule 10b-5
[17 C.F.R. § 240.10b-5].
SECOND CLAIM FOR RELIEF
Intrusion Violated Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)]
35. The SEC realleges and incorporates by reference each and every allegation
contained in the paragraphs above.
36. By engaging in the acts and conduct alleged herein, Intrusion, directly or
indirectly, in the offer or sale of a security, by the use of any means or instruments of
transportation or communication in interstate commerce or by use of the mails, has:
(a) knowingly or with severe recklessness employed a device, scheme, or
artifice to defraud; and/or
(b) knowingly, recklessly, or negligently obtained money or property by
means of an untrue statement of a material fact or an omission to state a
material fact necessary in order to make the statements made, in light of
the circumstances under which they were made, not misleading; and/or
(c) knowingly, recklessly, or negligently engaged in a transaction, practice, or
course of business which operated or would operate as a fraud or deceit
upon the purchaser.
37. By reason of the foregoing, Intrusion violated, and unless enjoined will continue
to violate, Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)].

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THIRD CLAIM FOR RELIEF
Intrusion Violated Section 13(a) of the Exchange Act [15 U.S.C. § 78m(a)]
and Exchange Act Rules 13a-11 and 13a-15(a)
[17 C.F.R. §§ 240.13a-11 and 240.13a-15(a)]
38. The SEC realleges and incorporates by reference each and every allegation
contained in the paragraphs above.
39. Intrusion is an issuer of securities registered under Section 12 of the Exchange
Act that filed required reports with the SEC under Section 13(a) of the Exchange Act and related
rules and regulations.
40. By engaging in the conduct described above, Intrusion failed to file current
reports with the SEC that were true and correct, and failed to maintain disclosure controls and
procedures.
41. By reason of the foregoing, Intrusion violated, and unless enjoined will continue
to violate, Section 13(a) of the Exchange Act [15 U.S.C. § 78m(a)] and Exchange Act Rules 13a-
11 and 13a-15(a) [17 C.F.R. §§ 240.13a-11 and 240.13a-15(a)].
PRAYER FOR RELIEF
THEREFORE, the SEC respectfully requests that the Court enter a Final Judgment that:
A. Permanently enjoins Defendant Intrusion from violating Section 10(b) of the
Exchange Act [15 U.S.C. § 78j(b)] and Exchange Act Rule 10b-5 [17 C.F.R. § 240.10b-5];
B. Permanently enjoins Defendant Intrusion from violating Section 17(a) of the
Securities Act [15 U.S.C. § 77q(a)];
C. Permanently enjoins Defendant Intrusion from violating Section 13(a) of the
Exchange Act [15 U.S.C. § 78m(a)] and Exchange Act Rules 13a-11 and 13a-15(a) [17 C.F.R.
§§ 240.13a-11 and 240.13a-15(a)]; and
D. Grants such further relief as the Court deems just and proper.

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Date: September 26, 2023   Respectfully submitted,
      /s/ Jason J. Rose
      JASON J. ROSE
Texas Bar No. 24007946
SECURITIES AND EXCHANGE
COMMISSION
Burnett Plaza, Suite 1900
801 Cherry Street, Unit 18
Fort Worth, Texas 76102
(817) 978-1408 (jjr)
(817) 978-4927 (facsimile)
[email protected]

     ATTORNEY FOR PLAINTIFF
     SECURITIES AND EXCHANGE
     COMMISSION

IN THE UNITED STATES DISTRICT COURT 
FOR THE EASTERN DISTRICT OF TEXAS 

SHERMAN DIVISION 
 
 
SECURITIES AND EXCHANGE COMMISSION, 
 
    Plaintiff, 
 
v. 
 
INTRUSION INC., 
 
    Defendant. 
 

 
 
 
Civil Action No.  4:23-cv-859 
 
 

 
COMPLAINT 

Plaintiff Securities and Exchange Commission (“SEC”) files this Complaint against 

Defendant Intrusion Inc. (“Intrusion” or the “Company”), and alleges as follows: 

SUMMARY 

1. Intrusion is a publicly traded cybersecurity company. Beginning in May 2020, the 

Company—primarily through its president, CEO, and director at the time (“Former CEO”)—

began promoting a new cybersecurity product that it called “Intrusion Shield” (“Shield”). From 

May 2020 through May 2021, in press releases, earnings calls, interviews, and other statements, 

Intrusion, through the Former CEO, made materially false and misleading statements regarding: 

(a) the Former CEO’s background and experience; (b) the Company’s success in marketing 

Shield to participants in its beta testing program; and (c) certain Company contracts, or purported 

contracts, with prospective customers. Intrusion’s conduct violated the antifraud, current 

reporting, and disclosure controls and procedures provisions of the federal securities laws. 

JURISDICTION AND VENUE 

2. The Court has jurisdiction over this action under Sections 20(b), 20(d), and 22 of 

the Securities Act of 1933 (“Securities Act”) [15 U.S.C. §§ 77t(b), 77t(d), and 77v] and Sections 

Case 4:23-cv-00859   Document 1   Filed 09/26/23   Page 1 of 16 PageID #:  1



 

 
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21(d), 21(e), and 27 of the Securities Exchange Act of 1934 (“Exchange Act”) [15 U.S.C. §§ 

78u(d), 78u(e), and 78aa]. Intrusion directly or indirectly made use of means or instrumentalities 

of interstate commerce, or of the mails, or the facilities of a national securities exchange, in 

connection with the transactions, acts, practices, and courses of business alleged herein. 

3. Venue in this district is proper under Section 22 of the Securities Act [15 U.S.C. § 

77v] and Section 27 of the Exchange Act [15 U.S.C. § 78aa] because certain acts, practices, 

transactions, and courses of business constituting the violations alleged herein occurred within 

this district. 

DEFENDANT 

4. Intrusion is a Delaware corporation with its principal place of business in Plano, 

Texas. Intrusion’s common stock trades under the ticker symbol INTZ on the Nasdaq Capital 

Market and has been registered with the SEC pursuant to Section 12(b) of the Exchange Act 

since October 8, 2020. Prior to that date, the Company’s common stock was registered with the 

SEC pursuant to Section 12(g) of the Exchange Act. Intrusion is required to file periodic and 

current reports with the SEC pursuant to Section 13(a) of the Exchange Act and the related rules 

thereunder.  

FACTS 

Intrusion’s Background and its Launch of Shield 

5.  Until 2020, Intrusion sold cybersecurity consulting services and two 

cybersecurity products that detected, analyzed, and reported cyberattacks or misuse of 

information. Intrusion’s customers during this time included government defense and security 

agencies and two commercial customers (“Customer A” and “Customer B”). In 2018 and 2019, 

Intrusion had a small net income because of large, one-time contracts, but operated at a loss the 

Case 4:23-cv-00859   Document 1   Filed 09/26/23   Page 2 of 16 PageID #:  2



 

 
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prior four years. In May 2020, following the death of Intrusion’s co-founder and longtime chief 

executive, the Company appointed the Former CEO. 

6. The Former CEO worked with the Company’s engineers to develop Shield, which 

was largely based on Intrusion’s existing products with certain additional enhancements and 

functionality. After commercial launch of Shield in January 2021, Intrusion offered Shield as a 

software-as-a-service product at $20 per “seat” (essentially per user), per month with no annual 

contract requirement. 

Intrusion’s Former CEO Reshaped the Company’s Culture 

7. Upon being appointed to the CEO position in May 2020, the Former CEO 

changed the Company’s previously cautious and fiscally conservative culture. He persuaded 

Intrusion’s board of directors to appoint his longtime friend and former colleague as a director 

and, shortly thereafter, as chairman, and he essentially forced out or fired some of the 

Company’s senior leadership. Under the Former CEO, Intrusion expanded rapidly, growing from 

approximately 30 employees to 110. 

Intrusion’s False and Misleading Statements 
 

8. Beginning with his appointment in May 2020, the Former CEO used his forceful, 

assertive style to tout his background and experience and to promote Shield as a cybercrime 

prevention tool. During these promotional efforts, Intrusion made numerous false and misleading 

statements (discussed in detail below), which were authored and/or approved by the Former 

CEO. 

Intrusion Misrepresents the Former CEO’s Background 
 

9. Intrusion made false and misleading statements regarding the Former CEO’s 

cybersecurity and public company experience. The Company issued a press release on May 27, 

2020 (and a purportedly corrective press release on May 29, 2020) announcing the appointment 

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of its new CEO (the Former CEO), which claimed that he had served as a director of five public 

companies. The May 29, 2020 press release also stated that the Former CEO had served as CIO 

(chief information officer) of the U.S. Department of Agriculture (“USDA”). Neither statement 

was true. 

10. First, the Former CEO had served on, at most, four public company boards. One 

of those four companies was not a U.S. public company, a second never identified him as a 

director in its public filings, and his tenure on a third company’s board lasted less than four 

months. In addition to the Company’s May 2020 press releases, Intrusion also included the false 

and misleading statement regarding the Former CEO’s public company experience in: (a) its 

Forms S-1 and S-1/A filed with the SEC in August and October 2020, respectively; (b) the 

prospectus for its October 2020 securities offering; and (c) its April 5, 2021 proxy statement. 

11. Second, the Former CEO was never the CIO of the USDA. He did hold the 

position of director of the Information Technology Services Division within the National Finance 

Center, a subdivision of the USDA. In that position, he reported to the chief financial officer of 

the National Finance Center, which primarily provides payroll processing and other financial and 

personnel services to the USDA and other federal agencies. The Former CEO repeated the false 

and misleading claim about serving as the CIO of the USDA in an October 2020 public offering 

roadshow presentation and a January 2021 investor conference presentation; both presentations 

were attached as exhibits to Forms 8-K filed by the Company with the SEC and signed by the 

Former CEO. Similarly, in an April 2021 radio interview, the Former CEO falsely and 

misleadingly stated that “… I was a CIO in the federal government a few years ago, fighting the 

Russians and Chinese for our entire federal government….” Although the National Finance 

Center provided payroll services to many federal agencies, the Former CEO was not the CIO of 

the USDA and did not serve the entire federal government in his USDA position. Intrusion’s 

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false and misleading statements regarding the Former CEO’s background were material because 

they led investors to believe that the Company’s most senior leader was more qualified, 

experienced, and accomplished than he actually was. 

Intrusion Overstates its Success Marketing Shield to Beta Testers 

12. During the fall of 2020, Intrusion solicited potential customers to evaluate and test 

Shield, a process referred to as beta testing. Thirteen companies participated in the beta test, 

including: (a) Intrusion’s public relations firm; (b) Intrusion’s securities offering underwriter; (c) 

a company whose CIO was the Former CEO’s son-in-law; (d) an investment adviser that 

invested in Intrusion; and (e) Customer B, whose chairman was an Intrusion board member. 

Despite Intrusion’s ties to several of the participants, only six of the 13 beta testers ultimately 

purchased Shield. As set forth below, Intrusion made statements over the course of several 

months that misrepresented the beta testing program. 

13. First, Intrusion misrepresented the companies that were beta testing Shield. In a 

written roadshow presentation to promote the Company’s October 2020 public securities 

offering, which was included as an exhibit to Intrusion’s October 5, 2020 Form 8-K filed with 

the SEC, Intrusion claimed that Shield had “[v]alidation from early adoption by [a] Fortune 100 

beta customer.” However, none of the beta testers was a Fortune 100 company.  

14. Further, Intrusion misrepresented its success in converting beta test participants 

into paying Shield customers. On January 13, 2021, the Former CEO approved an Intrusion press 

release, attached as an exhibit to a Form 8-K filed by the Company with the SEC and signed by 

the Former CEO, stating that “[a]ll of the companies participating in the beta program have made 

the decision to move forward with Shield in production.” The press release also quoted 

representatives of three of the beta testers, including the CIO of Intrusion’s securities 

underwriter. The same day (January 13, 2021), the Former CEO made a presentation at a 

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securities conference that included the claim that Shield had “[v]alidation from early adoption by 

12 ‘beta’ customers.” The presentation materials were also attached as an exhibit to the 

Company’s January 13, 2021 Form 8-K filed with the SEC. Intrusion’s stock price closed at 

$23.88 per share on January 13, 2021, up more than 18.5% from the prior day’s closing price, 

and its trading volume increased more than 30% from the day before. 

15. The January 13, 2021 press release issued by Intrusion was false and misleading. 

By that date, none of the beta testers had purchased Shield. In fact, when the Company issued the 

press release, the Former CEO—who received regular updates regarding the beta testing—knew 

that several participants had not moved forward beyond the beta testing stage. For example, just 

days prior to the press release, the CIO of Intrusion’s underwriter told the Former CEO that the 

underwriter would continue testing Shield because the product had not yet functioned on the 

underwriter’s primary network. Moreover, the underwriter’s CIO, who was quoted in the press 

release, had not given Intrusion approval to be quoted in the Company’s January 13, 2021 press 

release. Hours after the press release was published, the underwriter objected to Intrusion and the 

Company’s investor relations firm regarding the unauthorized quotation of its CIO, as well as to 

the statement that all beta testers were moving forward into production. 

16. The next day, January 14, 2021, Intrusion issued a purportedly corrective press 

release that replaced the quote from the underwriter’s CIO and stated that “[m]ost companies 

participating in the beta program are migrating to the production phase of Shield.” However, this 

press release continued to materially overstate and misrepresent Intrusion’s success in marketing 

Shield to its beta testers, as only one company involved in the beta testing had signed a contract 

at the time the Company issued the January 14, 2021 press release. 

17. After the January 2021 press releases, the Former CEO continued to 

misrepresent—both to investors and to Intrusion’s board—the Company’s success in marketing 

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Shield to the beta testers. Despite receiving a number of contemporaneous updates showing that 

only three of the beta testers had signed contracts, the Former CEO told the Company’s board on 

February 4, 2021 that “[m]ost Beta Customers have converted to paying customers.” Later that 

month, the Former CEO, referencing the January 2021 press releases, told an investor in an email 

that all beta testers other than the underwriter were “now under 1 or 3 year contracts.” And 

during the Company’s February 25, 2021 earnings call, Intrusion’s CEO stated that “90% of our 

beta customers became paying subscribers on the Shield.” 

18. The day after the earnings call Intrusion’s stock price closed at $24.38, up almost 

30% from the prior day’s close, and its trading volume increased approximately 629% from the 

day before. However, all of these claims regarding Shield’s beta testing success were false and 

misleading. As of February 25, 2021, only three of the 13 beta testers had signed contracts for 

Shield, while three of the beta testers had indicated they would not purchase it. Finally, despite 

an April 2021 update to the Former CEO showing that only five beta testers had been “won,” 

Intrusion’s presentation materials displayed at the Company’s May 18, 2021 shareholder meeting 

falsely stated that “[m]ost Beta Customers have converted to paying customers.” Intrusion’s false 

and misleading statements regarding the beta testing program were material because they 

misstated and/or overstated the Company’s success in marketing Shield, a product that was 

crucial to both the Company’s near-term and long-term financial condition. 

Intrusion Misleads Investors about its Contract with Customer A 

19. In early 2021, the Former CEO began to prime the market to expect one or more 

major Shield contracts. For example, during the February 25, 2021 earnings call, the Former 

CEO touted interest in Shield from large corporations, referencing Fortune 100 and 500 

companies that were evaluating or testing Shield. Then, on March 31, 2021, Intrusion issued a 

press release announcing that Customer A had signed an agreement to protect its network using 

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Shield. However, the actual terms of that agreement provided for a renewal of an existing 

contract with Customer A for other Intrusion services (not including Shield), for three years at 

the same price, as well as for Intrusion to provide Shield for free for three years, with an option 

for Customer A to renew Shield for another three years at a 93 percent discount. The press 

release, which referenced Customer A’s 46,000 employees worldwide, did not include any 

information regarding the specific terms of the contract. 

20. The March 31, 2021 press release was materially misleading because it omitted 

that Customer A did not pay for Shield (and had no obligation to ever pay for or use this 

product). Intrusion’s stock price closed approximately 19% higher than the prior trading day 

after the Company issued the March 31, 2021 press release, and its trading volume increased 

approximately 113% from the day before. Two industry analysts who followed Intrusion’s stock 

issued positive reports shortly thereafter, estimating, based on Intrusion’s publicized seat pricing 

for Shield, over $5 million in potential annual revenues from the Customer A contract—an 

amount greater than 75% of Intrusion’s total 2020 revenues of $6.6 million. 

21. Thereafter, Intrusion, through statements made and/or approved by the Former 

CEO, frequently and prominently referenced the Customer A contract as a Shield-adoption 

success story. Intrusion not only remained silent regarding the fact that Customer A received 

Shield for free, but in some instances the Company implied, or even stated, that Customer A was 

paying for Shield: 

• In an April 13, 2021 press release, Intrusion announced that Shield was 

“protecting over 50,000 seats,” and referenced Customer A signing on as a Shield 

customer. On April 13, 2021, Intrusion’s stock price closed at $28.25, up more 

than 19% from the prior day. Yet, at the time of this press release, Intrusion only 

had signed contracts for 550 paid seats. 

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• In an April 20, 2021 email, the Former CEO told a YouTube finance and 

technology commentator that all 50,000 seats referenced in the April 13 press 

release were paid.   

• In an April 22, 2021 press release refuting a negative research report about 

Intrusion and Shield, Intrusion again referenced its multi-year agreement with 

Customer A without disclosing that Customer A was not paying for Shield.  

• During the Company’s May 4, 2021 earnings call, the Former CEO specifically 

referenced Customer A when lauding what he described as the Company’s 

“extraordinary success” in licensing over 50,000 seats for Shield. He went on to 

explain Intrusion’s lack of first quarter revenues attributable to Shield by pointing 

to Intrusion’s new contract with Customer A to illustrate that Intrusion only 

received revenue as seats were implemented, saying “[s]o the revenues will come 

in as they bring on a territory or region and then the revenue start paying.” In 

truth, however, Customer A was not obligated to pay for Shield. 

• In a May 10, 2021 YouTube interview with a financial newsletter publisher, the 

Former CEO discussed the Company’s seat pricing for Shield, stating: “So, we 

are very profitable at $20.00 per seat. It obviously adds up. If you’re a Fortune 

500 with [Customer A], you know, with thousands and thousands of end users, 

that becomes a pretty big number pretty fast.” However, Customer A was not, in 

fact, paying for Shield (nor was it obligated to), so its contract would not add “a 

pretty big number” to Intrusion’s sales or income. 

22. Similarly, Intrusion also made false and misleading statements about the status of 

Customer A’s adoption of Shield. In an April 8, 2021 radio interview, the Former CEO said that 

the Company had installed Shield worldwide for Customer A. And during Intrusion’s May 4, 

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2021 earnings call, the Former CEO claimed that Customer A already had Shield seats 

implemented by the time of the Company’s March 31, 2021 press release. When the Former 

CEO made these statements, however, Customer A had no Shield appliances on its network. 

Rather, Customer A’s cyber defense officer was testing Shield at his residence on his home 

network. 

23. During the Company’s May 4, 2021 earnings call, the Former CEO also referred 

to the work that Customer A had conducted to evaluate Shield, stating that it was a major 

enterprise decision and that “this is as good of a rubber stamp as you can get that says certified, 

ready for production.” But, as the Former CEO knew, Customer A did not test or evaluate any 

Shield appliance prior to entering into the contract. In fact, in late March 2021, Customer A’s 

cyber defense officer told the Former CEO that Customer A had not run Shield on its network. 

24. The Former CEO understood the importance of the fact that Intrusion had given 

Shield to Customer A for free, as demonstrated by the numerous steps he took to conceal the 

contract’s actual terms from the public (as described above) and from Intrusion’s board and 

executives. For example, the Former CEO refused to tell Intrusion’s chief sales officer the 

pricing terms of the Customer A deal. Additionally, the Former CEO told the Company’s then 

CFO that the details of the Customer A contract should not be shared with anyone, saying: “I 

mean nobody. You, me and the board. That’s it.” Despite this statement, the Former CEO also 

kept the board in the dark. He falsely told Intrusion’s chairman and another director that the 

Customer A Shield contract provided additional revenue to Intrusion, when, in fact, it did not. 

The Former CEO also resisted repeated requests from directors to see the Customer A contract 

until June 2021, when he finally allowed the chairman to see the Customer A contract. 

Intrusion’s false and misleading statements regarding the Customer A contract were material 

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because they misstated and/or overstated the Company’s success in marketing Shield, a product 

that was crucial to both the Company’s near-term and long-term financial condition. 

Intrusion Misrepresents Two More Customer Relationships 

25. Intrusion also made false and misleading statements about the Company’s 

arrangements with two other businesses. On April 6, 2021, Intrusion issued a press release 

announcing that Customer B had “signed an agreement” for Shield, which quoted a Customer B 

executive. Intrusion made nearly identical claims about Customer B in an April 13, 2021 press 

release (referenced above in paragraph 21 in connection with the Company’s Customer A 

contract misrepresentations) and in an April 22, 2021 press release issued to refute a negative 

research report (also referenced above in paragraph 21). 

26. Although Customer B had indicated an interest in purchasing Shield in March 

2021, it did not sign a contract until early May 2021, after it negotiated a larger discount for the 

product. The Former CEO led Intrusion’s negotiations with Customer B until mid-April 2021 

and knew that Customer B objected to Intrusion’s proposed pricing. He also knew that Intrusion 

had not received a signed agreement from Customer B. Nonetheless, the Former CEO authorized 

the April 6, 2021 press release. 

27. Intrusion also made misleading statements about the Company’s relationship with 

a New Orleans-based government contractor (“Customer C”). In the April 13, 2021 press release, 

Intrusion claimed that it had finished the first quarter “with several key wins” and referenced 

customers, including Customer C, adopting Shield to protect their networks. Later, during the 

Company’s May 4, 2021 earnings call, the Former CEO emphasized the rapid evaluation and 

implementation of Shield by telling a story about a demonstration he did for a New Orleans 

contractor. The Former CEO stated that he demonstrated Shield and the contractor “bought the 

product the same day.” The Former CEO also claimed that when he jokingly said he could take 

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Shield back with him, the customer’s CIO said, “you’re never getting that appliance out of my 

network” and that he would sign the contract that day. 

28. The Former CEO admitted under oath that the firm referenced during the May 4, 

2021 earnings call was Customer C. However, Customer C did not sign a contract for Shield. In 

fact, when the Former CEO offered Shield for testing to Customer C’s CEO (who was a friend) 

in late March 2021, the Former CEO actually told him, “[y]ou don’t have to sign a contract.” 

And after he was fired by Intrusion in July 2021, the Former CEO told his friend that he was the 

only one at the Company who knew that Customer C was testing Shield and suggested that 

Customer C return Shield to avoid being charged. Intrusion’s false and misleading statements 

regarding the purported contracts with Customer B and Customer C were material because they 

misstated and/or overstated the Company’s success in marketing Shield, a new product that was 

crucial to both the Company’s near-term and long-term financial condition. 

Intrusion Terminates the Former CEO 

29. As described in paragraph 24 above, the Company’s chairman learned in early 

June 2021 that, contrary to the Former CEO’s prior representations to him, Intrusion had actually 

provided Shield to Customer A for free. Around that time, the chairman also learned that 

Intrusion’s beta tester conversion rate was much lower than the Former CEO had claimed and 

that the Company had far exceeded its budgeted hiring. On July 19, 2021, Intrusion’s board 

terminated the Former CEO’s employment. 

Intrusion Lacked Disclosure Controls and Procedures 

30. From at least May 2020 through July 2021, Intrusion had minimal and ineffective 

disclosure controls and procedures. For example, Intrusion lacked procedures to ensure that 

information was communicated to management to allow timely decisions regarding required and 

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accurate disclosures. Additionally, the controls or procedures that Intrusion had for its press 

releases and other current reports were informal, unwritten, and not consistently implemented. 

Intrusion Offered and Sold Securities 

31. On August 25, 2020, Intrusion filed an offering registration statement with the 

SEC on Form S-1 seeking to register the sale of up to 3,565,000 shares of its common stock. An 

amended Form S-1 was declared effective on October 8, 2020, and thereafter Intrusion sold stock 

to the public. Intrusion also registered the offer and sale of common stock pursuant to an 

employee compensation plan on Form S-8 on May 7, 2018. The Company’s false and misleading 

statements (described above in paragraphs 9 through 28) occurred during Intrusion’s offer and 

sale of its common stock to the public and/or its employees. 

FIRST CLAIM FOR RELIEF 

Intrusion Violated Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Exchange 
Act Rule 10b-5 [17 C.F.R. § 240.10b-5]   

32. The SEC realleges and incorporates by reference each and every allegation 

contained in the paragraphs above. 

33. By engaging in the acts and conduct alleged herein, Intrusion, directly or 

indirectly, in connection with the purchase or sale of a security, by the use of any means or 

instrumentality of interstate commerce, or of the mails or of any facility of any national securities 

exchange, knowingly or with severe recklessness: 

  (a) employed a device, scheme, or artifice to defraud; and/or 

(b) made an untrue statement of material fact, or omitted to state a material 

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

circumstances under which they were made, not misleading; and/or  

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(c) engaged in an act, practice, or course of business which operated or would 

operate as a fraud or deceit upon any person. 

34. By reason of the foregoing, Intrusion violated, and unless enjoined will continue 

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

[17 C.F.R. § 240.10b-5]. 

SECOND CLAIM FOR RELIEF 

Intrusion Violated Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)] 

35. The SEC realleges and incorporates by reference each and every allegation 

contained in the paragraphs above. 

36. By engaging in the acts and conduct alleged herein, Intrusion, directly or 

indirectly, in the offer or sale of a security, by the use of any means or instruments of 

transportation or communication in interstate commerce or by use of the mails, has: 

(a) knowingly or with severe recklessness employed a device, scheme, or 

artifice to defraud; and/or 

(b) knowingly, recklessly, or negligently obtained money or property by 

means of an untrue statement of a material fact or an omission to state a 

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

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

(c) knowingly, recklessly, or negligently engaged in a transaction, practice, or 

course of business which operated or would operate as a fraud or deceit 

upon the purchaser. 

37. By reason of the foregoing, Intrusion violated, and unless enjoined will continue 

to violate, Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)]. 

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THIRD CLAIM FOR RELIEF 

Intrusion Violated Section 13(a) of the Exchange Act [15 U.S.C. § 78m(a)] 
and Exchange Act Rules 13a-11 and 13a-15(a)  
[17 C.F.R. §§ 240.13a-11 and 240.13a-15(a)] 

38. The SEC realleges and incorporates by reference each and every allegation 

contained in the paragraphs above. 

39. Intrusion is an issuer of securities registered under Section 12 of the Exchange 

Act that filed required reports with the SEC under Section 13(a) of the Exchange Act and related 

rules and regulations. 

40. By engaging in the conduct described above, Intrusion failed to file current 

reports with the SEC that were true and correct, and failed to maintain disclosure controls and 

procedures. 

41. By reason of the foregoing, Intrusion violated, and unless enjoined will continue 

to violate, Section 13(a) of the Exchange Act [15 U.S.C. § 78m(a)] and Exchange Act Rules 13a-

11 and 13a-15(a) [17 C.F.R. §§ 240.13a-11 and 240.13a-15(a)]. 

PRAYER FOR RELIEF 

THEREFORE, the SEC respectfully requests that the Court enter a Final Judgment that: 

A. Permanently enjoins Defendant Intrusion from violating Section 10(b) of the 

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

B. Permanently enjoins Defendant Intrusion from violating Section 17(a) of the 

Securities Act [15 U.S.C. § 77q(a)]; 

C. Permanently enjoins Defendant Intrusion from violating Section 13(a) of the 

Exchange Act [15 U.S.C. § 78m(a)] and Exchange Act Rules 13a-11 and 13a-15(a) [17 C.F.R. 

§§ 240.13a-11 and 240.13a-15(a)]; and 

D. Grants such further relief as the Court deems just and proper. 

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Date: September 26, 2023   Respectfully submitted, 

      /s/ Jason J. Rose 
      JASON J. ROSE 

Texas Bar No. 24007946  
SECURITIES AND EXCHANGE 
COMMISSION 
Burnett Plaza, Suite 1900 
801 Cherry Street, Unit 18 
Fort Worth, Texas 76102 
(817) 978-1408 (jjr) 
(817) 978-4927 (facsimile) 
[email protected]  

 
     ATTORNEY FOR PLAINTIFF 
     SECURITIES AND EXCHANGE  
     COMMISSION     

Case 4:23-cv-00859   Document 1   Filed 09/26/23   Page 16 of 16 PageID #:  16


	Complaint
	SUMMARY
	JURISDICTION AND VENUE
	DEFENDANT
	FACTS
	Intrusion’s Background and its Launch of Shield

	FIRST CLAIM FOR RELIEF
	Intrusion Violated Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Exchange Act Rule 10b-5 [17 C.F.R. § 240.10b-5]

	SECOND CLAIM FOR RELIEF
	Intrusion Violated Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)]

	THIRD CLAIM FOR RELIEF
	Intrusion Violated Section 13(a) of the Exchange Act [15 U.S.C. § 78m(a)] and Exchange Act Rules 13a-11 and 13a-15(a)
	[17 C.F.R. §§ 240.13a-11 and 240.13a-15(a)]

	PRAYER FOR RELIEF