SEC v. ROGER KNOX

UNITED STATES DISTRICT COURT
DISTRICT OF MASSACHUSETTS

CIVIL ACTION NO. 18-12058-RGS

SECURITIES AND EXCHANGE COMMISSION,
Plaintiff

v.

ROGER KNOX, WINTERCAP S.A., MICHAEL T. GASTAUER, WB21 US
INC., SILVERTON SA INC., WB21 NA INC., C CAPITAL CORP.,
WINTERCAP SA INC., and B2 CAP INC.,
Defendants

and

RAIMUND GASTAUER, SIMONE GASTAUER FOEHR, B21 LTD.,
SHAMAL INTERNATIONAL FZE, and WB21 DMCC,
Relief Defendants

MEMORANDUM AND ORDER ON PLAINTIFF’S RENEWED MOTION
FOR SUMMARY JUDGMENT

January 29, 2025

STEARNS, D.J.
Before  the  court  is plaintiff United  States  Securities  and  Exchange
Commission’s  (the  Commission  or  SEC)  renewed  motion  for  summary
judgment  as  to  relief  defendant  Raimund  Gastauer.    For  the following
reasons, the court will allow the motion.
BACKGROUND

2

The  court  assumes  the  reader’s  familiarity  with  the  factual  and
procedural  history  of  the  case.    However,  by  way  of brief background,  on
October 7, 2022, the court issued a final judgment against Gastauer, finding
him liable on the SEC’s claim of unjust enrichment after his appropriation of
proceeds  of securities fraud committed  by his  son,  Michael Gastauer.   See
Dkt.  # 286  at  1.    The  court entered  an  order  of  disgorgement  against
Gastauer, requiring him to pay $3,315,305 plus prejudgment interest to the
SEC.  See Dkt. # 286 at 2.  Gastauer appealed the court’s determination that
it could exercise personal jurisdiction over him and the proceeds of the fraud
ancillary to its uncontested jurisdiction over his son, whom the court deemed
as the real defendant-in-interest.  See Dkt. # 287 at 1.  On February 9, 2024,
the  First  Circuit  reversed  the  court’s  entry  of  final  judgment  against
Gastauer, rejecting  the  court’s  theory of derivative jurisdiction and
remanded the  matter for further  proceedings.
1
   See SEC v.  Gastauer,  913
F.4th 1, 13 (1st Cir. 2024).
On  remand,  the  court  ordered  the  parties  to  submit  supplemental
briefing on the issue of whether Gastauer had sufficient minimum contacts

1
 As the Commission limited its argument on appeal to the imputation
of   jurisdictional   contacts   from   the   defendant-in-interest,   Michael,   to
Gastauer,  the  First  Circuit  did  not  consider  whether  Gastauer  satisfied  the
minimum    contacts    requirement,    such    as    by    engaging    in    financial
transactions facilitated through U.S.-based institutions.  See id. at 9 n.4.

3

with this forum  for  the  court to  exercise specific  personal  jurisdiction  over
him.   See Dkt.  #  314.    The  SEC then moved against  Gastauer  based  on  his
personal contacts with the forum or, in the alternative, to take jurisdictional
discovery.  See Dkt. # 315.  Gastauer did not oppose the motion.  Responding
to the SEC’s motion, the court ruled that the SEC had “ma[de] out a colorable
case  for  jurisdiction”  and “identifie[d] factual  disputes  that  may  show
exercising   jurisdiction   over   Gastauer   is   proper” – including discovery
confirming the extent of Gastauer’s involvement in financial transactions in
the  United  States and his obtaining of funds  from  bank  accounts  in  the
United States.
2
  Dkt. # 317.  The court accordingly permitted the Commission
to  take  limited  jurisdictional  discovery  on  the  issue  of  Gastauer’s
involvement  in U.S.-based financial  transactions  involving  Michael,  WB21
US Inc., and C Capital Corp.
3
  See id.
The Commission properly served on Gastauer document requests and
interrogatories, and noticed a deposition of Gastauer.  See Shields Decl. (Dkt.

2
 The court, on the factual record at the time, denied the SEC’s motion
to exercise personal jurisdiction without prejudice.

3
 After  applying  the  balancing  test  of Société Nationale  Industrielle
Aérospatiale  v.  U.S.  District  Court  for  the  Southern  District  of  Iowa,  482
U.S. 522 (1987), the court also allowed the Commission to rely on the Federal
Rules  of  Civil  Procedure  instead  of  the  Hague  Evidence  Convention  and
Hague Service Convention for jurisdictional discovery.  See Dkt. # 317.

4

# 320) ¶ 2.  After Gastauer, again, refused to produce any documents, answer
the interrogatories, or sit for a deposition, the Commission moved a second
time for an order to compel Gastauer to respond to its discovery requests, or
in the alternative, for sanctions under Federal Rules of Civil Procedure 37(b)
and  (d),  specifically  a  finding  that  personal  jurisdiction  over  Gastauer  is
conclusively established.  See Dkt. # 318 at 1.  Gastauer did not oppose the
Commission’s motion.  Instead, he terminated his U.S. counsel and relayed
through his German counsel that “he does not admit to the US courts as a
valid jurisdiction.”  See Dkt. # 327; Ex. 4 at 1 (Dkt. # 320-4).
The court scheduled a hearing for August 6, 2024 via video conference
for the SEC’s motion and ordered that “Gastauer should be prepared to show
cause   why   sanctions   up   to   and   including   establishing   as   admitted
jurisdictional facts should not issue.”  Dkt. # 322, 324.  The court also stated
that “[i]f Gastauer fails to appear at the hearing, the court will entertain a
motion for default judgment,” but underscored that Gastauer’s appearance
at the hearing would not waive any valid jurisdictional defense that he might
wish to pursue.  Dkt. # 324.
Despite having notice of the hearing, Gastauer failed to appear.  Dkt. #
328.  The court granted the Commission’s motion and deemed as admitted
facts sufficient to establish specific personal jurisdiction over him.  See id.,

5

citing Ins. Corp. of Ireland, Ltd. v. Compagnie des Bauxites de Guinee, 456
U.S. 694, 705-706 (1982); Hooper-Haas v. Ziegler Holdings, LLC, 690 F.3d
34, 38-39 (1st Cir. 2012) (holding if “the sanction fits the misconduct, a trial
court is not obligated to withhold the sanction.”)
LEGAL STANDARD
Summary  judgment  is  appropriate  when,  based  upon  the  pleadings,
affidavits, and depositions, “there is no genuine dispute as to any material
fact and the movant is entitled to judgment as a matter of law.”  Fed. R. Civ.
P. 56(a).  “To succeed, the moving party must show that there is an absence
of evidence to support the nonmoving party’s position.”  Rogers v. Fair, 902
F.2d 140, 143 (1st Cir. 1990).  “‘[T]he mere existence of a scintilla of evidence’
is   insufficient   to   defeat   a   properly   supported   motion   for   summary
judgment.”  Torres  v.  E.I.  Dupont  De Nemours  &  Co.,  219  F.3d  13,  18  (1st
Cir.  2000),  quoting Anderson  v.  Liberty  Lobby,  Inc.,  477  U.S.  242,  252
(1986).
DISCUSSION
The  Commission now requests  that  the  court  reinstate  its  prior
summary   judgment   ruling   against   Gastauer,   consistent   with   its   prior
warning that it was prepared to impose sanctions for Gastauer’s refusal to

6

cooperate with discovery.  See Dkt. # 330 at 1.  Gastauer, again, refused to
respond.
4

There has  been  no  subsequent  factual  development  that  calls  the
court’s  prior  findings  into  question.
5
  Nor   are   due   process   concerns
implicated by the court’s reinstatement of its summary judgment ruling.  See
Ins.  Corp.  of  Ireland,  Ltd.,  456  U.S.  at  705  (holding  that  there  is  no  due
process  violation  when  a  district  court  imposes  under  Rule  37(b)  an  order
subjecting a party to personal jurisdiction as a sanction for the party’s failure
to  comply  with  a  discovery  order  seeking  to  establish  facts  relating  to  the
court’s personal jurisdiction over it).  After Gastauer failed to respond to the

4
 On October 28, 2024, the court reminded Gastauer, after his United
States counsel withdrew, that he had until November 14, 2024 to oppose the
Commission’s  Motion  for  Summary  Judgment.   See Dkt.  #  333.    The
Commission  emailed  Gastauer’s  German-based  counsel  the  court’s
reminder, to which Gastauer’s counsel indicated that Gastauer would not be
accepting any “Court documents . . . other than that received from Germany’s
central  authority  under the Hague Convention on Service.”  Klunder Decl.
(Dkt. # 298) ¶¶ 3, 4.

5
 On June 3, 2022, the court found that Gastauer was liable for unjust
enrichment for $500,000 in proceeds that he received on December 26, 2017
from  Entity  Defendant  WB21  US  Inc.    Dkt.  #  263  at  18.    After  sanctioning
Gastauer – including  granting  the  Commission’s  motion  for  summary
judgment  in  full – for  violating  numerous  discovery  orders,  the  court on
October 7, 2022 held that Gastauer was liable for unjust enrichment for two
additional wire transfers, totaling $2,815,305, on  February  27,  2018  from
Entity Defendant C Capital Corp. that were used to purchase a condominium
at 3 Dollar Bay Place, London.

7

SEC’s jurisdictional discovery requests and failed to appear remotely at the
court’s  August  6,  2024  hearing,  which  specifically  noted  that  Gastauer
“should  be  prepared  to  show  cause  why  sanctions  up  to  and  including
establishing  as  admitted  jurisdictional facts should not issue,” Dkt. # 324,
the  court  sanctioned  him  under  Rule  37(b),  deeming as  admitted  facts
sufficient  to  establish  specific  personal  jurisdiction  over  him – Gastauer’s
litigation  misconduct  is  directly  related  to  the  merits  of  the  jurisdictional
issue.  Cf. Fuld v. Palestine Liberation Org., 82 F.4th 74, 94 (2d Cir. 2023).
The court   will therefore reinstate   its   prior   finding   of   summary
judgment and require Gastauer to pay to the Commission his ill-gotten gains,
which total $3,315,305, plus $1,347,326 in prejudgment interest to account
for the additional time that Gastauer has had use of his gains.
6
  See SEC v.
Sargent, 329 F.3d 34, 40 (1st Cir. 2003) (holding that “prejudgment interest,
like the disgorgement remedy, is intended to deprive wrongdoers of profits
they illegally obtained by violating the securities laws”).
ORDER

6
 The    prejudgment    interest    is    calculated    based    on    the    IRS
Underpayment Rate, using the date on which Gastauer received the relevant
transfers as the starting date.  See McCann Decl. (Dkt. # 332) ¶ 6.

8

 For the foregoing reasons, the Commission’s motion is GRANTED.
Gastauer  is  ordered  to  pay  $4,662,631  to  the  Commission.    The  Clerk  will
enter judgment accordingly.
SO ORDERED.
/s/ Richard G. Stearns
UNITED STATES DISTRICT JUDGE

UNITED STATES DISTRICT COURT 

DISTRICT OF MASSACHUSETTS 

 

CIVIL ACTION NO. 18-12058-RGS 

  

SECURITIES AND EXCHANGE COMMISSION, 
Plaintiff 

 

v. 

 
ROGER KNOX, WINTERCAP S.A., MICHAEL T. GASTAUER, WB21 US 

INC., SILVERTON SA INC., WB21 NA INC., C CAPITAL CORP., 
WINTERCAP SA INC., and B2 CAP INC., 

Defendants 

 

and 

 

RAIMUND GASTAUER, SIMONE GASTAUER FOEHR, B21 LTD., 
SHAMAL INTERNATIONAL FZE, and WB21 DMCC, 

Relief Defendants 

 

MEMORANDUM AND ORDER ON PLAINTIFF’S RENEWED MOTION 

FOR SUMMARY JUDGMENT 

 

January 29, 2025 

 

STEARNS, D.J. 

Before the court is plaintiff United States Securities and Exchange 

Commission’s (the Commission or SEC) renewed motion for summary 

judgment as to relief defendant Raimund Gastauer.  For the following 

reasons, the court will allow the motion.  

BACKGROUND 

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2 
 

The court assumes the reader’s familiarity with the factual and 

procedural history of the case.  However, by way of brief background, on 

October 7, 2022, the court issued a final judgment against Gastauer, finding 

him liable on the SEC’s claim of unjust enrichment after his appropriation of 

proceeds of securities fraud committed by his son, Michael Gastauer.  See 

Dkt. # 286 at 1.  The court entered an order of disgorgement against 

Gastauer, requiring him to pay $3,315,305 plus prejudgment interest to the 

SEC.  See Dkt. # 286 at 2.  Gastauer appealed the court’s determination that 

it could exercise personal jurisdiction over him and the proceeds of the fraud 

ancillary to its uncontested jurisdiction over his son, whom the court deemed 

as the real defendant-in-interest.  See Dkt. # 287 at 1.  On February 9, 2024, 

the First Circuit reversed the court’s entry of final judgment against 

Gastauer, rejecting the court’s theory of derivative jurisdiction and 

remanded the matter for further proceedings.1   See SEC v. Gastauer, 913 

F.4th 1, 13 (1st Cir. 2024).   

On remand, the court ordered the parties to submit supplemental 

briefing on the issue of whether Gastauer had sufficient minimum contacts 

 
1 As the Commission limited its argument on appeal to the imputation 

of jurisdictional contacts from the defendant-in-interest, Michael, to 
Gastauer, the First Circuit did not consider whether Gastauer satisfied the 
minimum contacts requirement, such as by engaging in financial 
transactions facilitated through U.S.-based institutions.  See id. at 9 n.4. 

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3 
 

with this forum for the court to exercise specific personal jurisdiction over 

him.  See Dkt. # 314.  The SEC then moved against Gastauer based on his 

personal contacts with the forum or, in the alternative, to take jurisdictional 

discovery.  See Dkt. # 315.  Gastauer did not oppose the motion.  Responding 

to the SEC’s motion, the court ruled that the SEC had “ma[de] out a colorable 

case for jurisdiction” and “identifie[d] factual disputes that may show 

exercising jurisdiction over Gastauer is proper” – including discovery 

confirming the extent of Gastauer’s involvement in financial transactions in 

the United States and his obtaining of funds from bank accounts in the 

United States.2  Dkt. # 317.  The court accordingly permitted the Commission 

to take limited jurisdictional discovery on the issue of Gastauer’s 

involvement in U.S.-based financial transactions involving Michael, WB21 

US Inc., and C Capital Corp.3  See id.  

The Commission properly served on Gastauer document requests and 

interrogatories, and noticed a deposition of Gastauer.  See Shields Decl. (Dkt. 

 
2 The court, on the factual record at the time, denied the SEC’s motion 

to exercise personal jurisdiction without prejudice.   
 
3 After applying the balancing test of Société Nationale Industrielle 

Aérospatiale v. U.S. District Court for the Southern District of Iowa, 482 
U.S. 522 (1987), the court also allowed the Commission to rely on the Federal 
Rules of Civil Procedure instead of the Hague Evidence Convention and 
Hague Service Convention for jurisdictional discovery.  See Dkt. # 317. 

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4 
 

# 320) ¶ 2.  After Gastauer, again, refused to produce any documents, answer 

the interrogatories, or sit for a deposition, the Commission moved a second 

time for an order to compel Gastauer to respond to its discovery requests, or 

in the alternative, for sanctions under Federal Rules of Civil Procedure 37(b) 

and (d), specifically a finding that personal jurisdiction over Gastauer is 

conclusively established.  See Dkt. # 318 at 1.  Gastauer did not oppose the 

Commission’s motion.  Instead, he terminated his U.S. counsel and relayed 

through his German counsel that “he does not admit to the US courts as a 

valid jurisdiction.”  See Dkt. # 327; Ex. 4 at 1 (Dkt. # 320-4).   

The court scheduled a hearing for August 6, 2024 via video conference 

for the SEC’s motion and ordered that “Gastauer should be prepared to show 

cause why sanctions up to and including establishing as admitted 

jurisdictional facts should not issue.”  Dkt. # 322, 324.  The court also stated 

that “[i]f Gastauer fails to appear at the hearing, the court will entertain a 

motion for default judgment,” but underscored that Gastauer’s appearance 

at the hearing would not waive any valid jurisdictional defense that he might 

wish to pursue.  Dkt. # 324.   

Despite having notice of the hearing, Gastauer failed to appear.  Dkt. # 

328.  The court granted the Commission’s motion and deemed as admitted 

facts sufficient to establish specific personal jurisdiction over him.  See id., 

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5 
 

citing Ins. Corp. of Ireland, Ltd. v. Compagnie des Bauxites de Guinee, 456 

U.S. 694, 705-706 (1982); Hooper-Haas v. Ziegler Holdings, LLC, 690 F.3d 

34, 38-39 (1st Cir. 2012) (holding if “the sanction fits the misconduct, a trial 

court is not obligated to withhold the sanction.”) 

LEGAL STANDARD 

Summary judgment is appropriate when, based upon the pleadings, 

affidavits, and depositions, “there is no genuine dispute as to any material 

fact and the movant is entitled to judgment as a matter of law.”  Fed. R. Civ. 

P. 56(a).  “To succeed, the moving party must show that there is an absence 

of evidence to support the nonmoving party’s position.”  Rogers v. Fair, 902 

F.2d 140, 143 (1st Cir. 1990).  “‘[T]he mere existence of a scintilla of evidence’ 

is insufficient to defeat a properly supported motion for summary 

judgment.”  Torres v. E.I. Dupont De Nemours & Co., 219 F.3d 13, 18 (1st 

Cir. 2000), quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252 

(1986). 

DISCUSSION 

The Commission now requests that the court reinstate its prior 

summary judgment ruling against Gastauer, consistent with its prior 

warning that it was prepared to impose sanctions for Gastauer’s refusal to 

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6 
 

cooperate with discovery.  See Dkt. # 330 at 1.  Gastauer, again, refused to 

respond.4 

There has been no subsequent factual development that calls the 

court’s prior findings into question.5  Nor are due process concerns 

implicated by the court’s reinstatement of its summary judgment ruling.  See 

Ins. Corp. of Ireland, Ltd., 456 U.S. at 705 (holding that there is no due 

process violation when a district court imposes under Rule 37(b) an order 

subjecting a party to personal jurisdiction as a sanction for the party’s failure 

to comply with a discovery order seeking to establish facts relating to the 

court’s personal jurisdiction over it).  After Gastauer failed to respond to the 

 
4 On October 28, 2024, the court reminded Gastauer, after his United 

States counsel withdrew, that he had until November 14, 2024 to oppose the 
Commission’s Motion for Summary Judgment.  See Dkt. # 333.  The 
Commission emailed Gastauer’s German-based counsel the court’s 
reminder, to which Gastauer’s counsel indicated that Gastauer would not be 
accepting any “Court documents . . . other than that received from Germany’s 
central authority under the Hague Convention on Service.”  Klunder Decl. 
(Dkt. # 298) ¶¶ 3, 4.   

 
5 On June 3, 2022, the court found that Gastauer was liable for unjust 

enrichment for $500,000 in proceeds that he received on December 26, 2017 
from Entity Defendant WB21 US Inc.  Dkt. # 263 at 18.  After sanctioning 
Gastauer – including granting the Commission’s motion for summary 
judgment in full – for violating numerous discovery orders, the court on 
October 7, 2022 held that Gastauer was liable for unjust enrichment for two 
additional wire transfers, totaling $2,815,305, on February 27, 2018 from 
Entity Defendant C Capital Corp. that were used to purchase a condominium 
at 3 Dollar Bay Place, London.   

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7 
 

SEC’s jurisdictional discovery requests and failed to appear remotely at the 

court’s August 6, 2024 hearing, which specifically noted that Gastauer 

“should be prepared to show cause why sanctions up to and including 

establishing as admitted jurisdictional facts should not issue,” Dkt. # 324, 

the court sanctioned him under Rule 37(b), deeming as admitted facts 

sufficient to establish specific personal jurisdiction over him – Gastauer’s 

litigation misconduct is directly related to the merits of the jurisdictional 

issue.  Cf. Fuld v. Palestine Liberation Org., 82 F.4th 74, 94 (2d Cir. 2023).   

The court will therefore reinstate its prior finding of summary 

judgment and require Gastauer to pay to the Commission his ill-gotten gains, 

which total $3,315,305, plus $1,347,326 in prejudgment interest to account 

for the additional time that Gastauer has had use of his gains.6  See SEC v. 

Sargent, 329 F.3d 34, 40 (1st Cir. 2003) (holding that “prejudgment interest, 

like the disgorgement remedy, is intended to deprive wrongdoers of profits 

they illegally obtained by violating the securities laws”).   

ORDER 

 
6 The prejudgment interest is calculated based on the IRS 

Underpayment Rate, using the date on which Gastauer received the relevant 
transfers as the starting date.  See McCann Decl. (Dkt. # 332) ¶ 6.   

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8 
 

 For the foregoing reasons, the Commission’s motion is GRANTED.  

Gastauer is ordered to pay $4,662,631 to the Commission.  The Clerk will 

enter judgment accordingly.  

SO ORDERED. 

/s/ Richard G. Stearns 

UNITED STATES DISTRICT JUDGE 

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