SEC v. Eric J. Watson; Oliver-Barret Lindsay; and Gannon Giguiere, No. LR-26350, Southern District of New York (July 15, 2025) — Press Release

U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 26350 / July 15, 2025 Securities and Exchange Commission v. Watson et al., No. 1:21-cv-05923 (S.D.N.Y. filed July 9, 2021) SEC Defeats Motion to Dismiss Brought by Tipper in Insider Trading Case On June 30, 2025, the U.S. District Court for the Southern District of New York denied defendant Eric J. Watson’s motion to dismiss the SEC’s insider trading claim against him. The SEC’s complaint, filed on July 9, 2021, alleges Watson, who was an insider and controlling shareholder of Long Island Iced Tea Corp. (LTEA), tipped his business associate, defendant Oliver-Barret Lindsay, with material nonpublic information about LTEA’s forthcoming announcement that it was pivoting its business from soft drink manufacturing to blockchain technology. According to the SEC’s complaint, Watson, a control person of LTEA who planned and executed LTEA’s purported pivot to blockhain, had signed a confidentiality agreement but ignored it, tipping Lindsay off to such plans, including by sharing a draft of the company’s press release announcing the change in business plans. Allegedly, Lindsay then passed the material nonpublic information on to his friend, defendant Gannon Giguiere, who, within hours of receiving this confidential information, purchased 35,000 shares of LTEA stock. According to the complaint, the company's stock price skyrocketed after the press release was issued announcing the change in business plans, spiking more than 380% intraday. Within two hours of this announcement, Giguiere allegedly sold his shares for more than $160,000 in illicit profits. Watson moved to dismiss the SEC’s complaint, challenging the sufficiency of the SEC’s claims against him and arguing that service on him was insufficient. The complaint charged Watson with violating Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The Court found that the SEC sufficiently alleged that Watson engaged in insider tipping and held that the SEC had properly served its complaint on Watson through Court-approved service by publication. Watson also brought a counterclaim against the SEC, which the Court dismissed. The SEC’s litigation is being led by Chevon Walker, Mary Kay Dunning, and Lindsay S. Moilanen, supervised by Sheldon L. Pollock and Jack Kaufman, all of the New York Regional Office.

U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 26350 / July 15, 2025 Securities and Exchange Commission v. Watson et al., No. 1:21-cv-05923 (S.D.N.Y. filed July 9, 2021) SEC Defeats Motion to Dismiss Brought by Tipper in Insider Trading Case On June 30, 2025, the U.S. District Court for the Southern District of New York denied defendant Eric J. Watson’s motion to dismiss the SEC’s insider trading claim against him. The SEC’s complaint, filed on July 9, 2021, alleges Watson, who was an insider and controlling shareholder of Long Island Iced Tea Corp. (LTEA), tipped his business associate, defendant Oliver-Barret Lindsay, with material nonpublic information about LTEA’s forthcoming announcement that it was pivoting its business from soft drink manufacturing to blockchain technology. According to the SEC’s complaint, Watson, a control person of LTEA who planned and executed LTEA’s purported pivot to blockhain, had signed a confidentiality agreement but ignored it, tipping Lindsay off to such plans, including by sharing a draft of the company’s press release announcing the change in business plans. Allegedly, Lindsay then passed the material nonpublic information on to his friend, defendant Gannon Giguiere, who, within hours of receiving this confidential information, purchased 35,000 shares of LTEA stock. According to the complaint, the company's stock price skyrocketed after the press release was issued announcing the change in business plans, spiking more than 380% intraday. Within two hours of this announcement, Giguiere allegedly sold his shares for more than $160,000 in illicit profits. Watson moved to dismiss the SEC’s complaint, challenging the sufficiency of the SEC’s claims against him and arguing that service on him was insufficient. The complaint charged Watson with violating Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The Court found that the SEC sufficiently alleged that Watson engaged in insider tipping and held that the SEC had properly served its complaint on Watson through Court-approved service by publication. Watson also brought a counterclaim against the SEC, which the Court dismissed. The SEC’s litigation is being led by Chevon Walker, Mary Kay Dunning, and Lindsay S. Moilanen, supervised by Sheldon L. Pollock and Jack Kaufman, all of the New York Regional Office.