This case was last updated from U.S. District Courts on 11/22/2022 at 08:01:18 (UTC).

Securities and Exchange Commission v. Barton et al

Case Summary

On September 23, 2022, the U.S. Securities and Exchange Commission (“SEC” or “Plaintiff”), represented by David B. Reece, James E. Etri, and Keefe M. Bernstein of the SEC, filed a civil enforcement action against Timothy Barton, Carnegie Development, LLC, Wall007, LLC (“Wall 7”), Wall009, LLC (“Wall 9”), Wall010, LLC (“Wall 10”), Wall011, LLC (“Wall 11”), Wall012, LLC (“Wall 12”), Wall016, LLC (“Wall 16”), Stephen T. Wall (“Wall”), and others (collectively, “Defendants”), as well as “Relief Defendants” DJD Land Partners, LLC (“DJD”) and LDG001, LLC (“LDG001”), seeking injunctive relief with disgorgement of ill-gotten gains and civil penalty for alleged fraud on investors. This case was filed in the U.S. District Court for the Northern District of Texas with Judge Brantley Starr presiding.

In the complaint, the SEC alleged, “From approximately March 2017 through June 2019, Barton, a Texas-based real estate developer, raised approximately $26 million from over 100 investors – most of whom are Chinese nationals – in unregistered, fraudulent securities offerings related to real-estate investments in Texas.” 

The SEC then alleged that in order “[t]o implement his scheme, Barton partnered with Wall, an experienced Texas home builder, and Fu, a Chinese businessman, to offer and sell investment loans issued by a series of single purpose ‘Wall’ entities. Barton, Wall, and Fu chose this naming convention to capitalize on investors’ confidence and trust in Wall, who had previously sold homes to Chinese investors solicited by Fu.” 

The SEC further alleged, “Barton formed and controlled the Wall entities, which promised to use the investors’ funds, together with funds from the Wall entities themselves, to purchase specific parcels of land at specific prices set forth in the offering materials. Barton would then develop that land into residential lots, and Wall would build homes on the lots and sell them. The Wall entities promised investors they would receive their principal back in two years along with annual interest payments.”

The SEC also alleged, “In reality, Barton, Wall, and Fu inflated the land purchase prices in the offering materials, which enabled them to raise more money from investors; overstated the value of the assets securing the investments; and concealed that the Wall entities were not actually contributing any funds. Barton, using entities he controlled, then misappropriated nearly all the investor funds, misusing them to, among other things, purchase properties in the name of other entities he controlled, pay undisclosed fees and commissions to Fu, pay expenses associated with unrelated real estate development projects, and fund his lifestyle.” 

Additionally, the SEC alleged, “The Wall entities were left with little or no assets, the projects were not developed, and the investors were never paid back.”

The SEC presented six claims for relief, including claims for the allegations of violations of the Exchange Act and violations of the Securities Act.

In the prayer for relief, the SEC requested a judgment seeking to permanently enjoin all Defendants from violating, directly or indirectly, the Securities Act and the Exchange Act, and permanently enjoin Barton, Fu, and Wall from directly or indirectly, participating in the issuance, purchase, offer, or sale of any securities except the securities listed on a national securities exchange from their own personal account. The SEC also requested an order for each defendant to disgorge all ill-gotten gains, plus prejudgment interest thereon, and to pay a civil penalty.

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Case Details Parties Documents Dockets

 

Case Details

  • Case Number:

    3:22-CV-02118

  • Filing Date:

    09/23/2022

  • Case Status:

    Pending - Other Pending

  • Case Type:

    Finance - Security/Commodity/Exchange

Judge Details

Presiding Judge

Brantley Starr

 

Party Details

Plaintiff

Securities and Exchange Commission

Defendants

Haoqiang Fu

Timothy Barton

Carnegie Development LLC

Wall007 LLC

Wall009 LLC

Wall010 LLC

Wall011 LLC

Wall012 LLC

Wall016 LLC

Wall017 LLC

Wall018 LLC

Wall019 LLC

Michael Fu

Stephen T Wall

DJD Land Partners LLC

LDG001 LLC

Respondent

Bank of America, N.A.

Interested Parties

HNGH Turtle Creek

Maximilien Barton

7 More Parties Available

Attorney/Law Firm Details

Plaintiff Attorneys

Keefe M Bernstein

David B Reece

James E Etri

Defendant Attorneys

Richard B Roper, III

Edwin Andrew Huffman

Sean O'Connell

Javan Porter

Michael Christopher Dingman

Michael J Edney

Michael P Heiskell

Interested Party Attorneys

Erin Angela Nealy Cox

John Joseph Kane

Nathan Benjamin Baum

Chris Cooke

Other Attorneys

Cort Thomas

Charlene Cantrell Koonce

 

Court Documents

#68

(#68) AMENDED DOCUMENT by Bank of America, N.A.. Amendment to #50 Affidavit. . (Moeller, Evan) (Entered: 11/21/2022)

#67

(#67) STATUS REPORT Receiver's Initial Status Report filed by Receiver. (Thomas, Cort) (Entered: 11/17/2022)

#66

(#66) NOTICE OF INTERLOCUTORY APPEAL as to #63 Order on Motion for Miscellaneous Relief, 33 Order on Motion to Amend/Correct, #62 Order on Motion for Miscellaneous Relief, #29 Order on Motion for Miscellaneous Relief to the Fifth Circuit by Timothy Barton. Filing fee $505, receipt number ATXNDC-13311453. T.O. form to appellant electronically at #Transcript Order Form or US Mail as appropriate. Copy of NOA to be sent US Mail to parties not electronically noticed. IMPORTANT ACTION REQUIRED: Provide an electronic copy of any exhibit you offered during a hearing or trial that was admitted into evidence to the clerk of the district court within 14 days of the date of this notice. Copies must be transmitted as PDF attachments through ECF by all ECF Users or delivered to the clerk on a CD by all non-ECF Users. See detailed instructions #here. (Exception: This requirement does not apply to a pro se prisoner litigant.) Please note that if original exhibits are in your possession, you must maintain them through final disposition of the case. (Edney, Michael) (Entered: 11/17/2022)

#64

(#64) ORDER: The Court GRANTS #44 the United States of America's Motion to Intervene and Stay Proceedings. This proceeding is STAYED until otherwise ordered by the Court. Nothing in this Order shall prevent the Court-appointed Receiver from performing the duties and exercising the powers set forth in #29 the Court's Order Appointing Receiver, as supplemented by #62 the Court's Order Supplementing the Order Appointing Receiver. (Ordered by Judge Brantley Starr on 11/16/2022) (chmb) (Main Document 64 replaced on 11/16/2022) (rekc). (Entered: 11/16/2022)

#63

(#63) ORDER: The Court GRANTS the Receivers #47 Motion for Order Governing Administration of Receivership Estate, Etc. As to non-party HNGHs #51 Response and Objection, the Court withholds judgment regarding the ownership of real property located at 2999 Turtle Creek Boulevard, Dallas, Texas 75219, because that question is not yet properly before the Court. (Ordered by Judge Brantley Starr on 11/16/2022) (chmb) (Entered: 11/16/2022)

#62

(#62) ORDER: The Court GRANTS the Receivers #41 Motion to Supplement Order Appointing Receiver as detailed herein. As to non-party HNGHs #51 Response and Objection, the Court withholds judgment regarding the ownership of real property located at 2999 Turtle Creek Boulevard, Dallas, Texas 75219, because that question is not yet properly before the Court. (Ordered by Judge Brantley Starr on 11/16/2022) (chmb) (Entered: 11/16/2022)

61 #61

Main Document

#50

(#68) AMENDED DOCUMENT by Bank of America, N.A.. Amendment to #50 Affidavit. . (Moeller, Evan) (Entered: 11/21/2022)

#29

(#64) ORDER: The Court GRANTS #44 the United States of America's Motion to Intervene and Stay Proceedings. This proceeding is STAYED until otherwise ordered by the Court. Nothing in this Order shall prevent the Court-appointed Receiver from performing the duties and exercising the powers set forth in #29 the Court's Order Appointing Receiver, as supplemented by #62 the Court's Order Supplementing the Order Appointing Receiver. (Ordered by Judge Brantley Starr on 11/16/2022) (chmb) (Main Document 64 replaced on 11/16/2022) (rekc). (Entered: 11/16/2022)

7 #1

Additional Page(s) Part 1 of 5

6 #1

Proposed Order

6 #6

Main Document

#5

(#5) Summons Issued as to Timothy Barton, Carnegie Development LLC, DJD Land Partners LLC, Haoqiang Fu, LDG001 LLC, Stephen T Wall, Wall007 LLC, Wall009 LLC, Wall010 LLC, Wall011 LLC, Wall012 LLC, Wall016 LLC, Wall017 LLC, Wall018 LLC, Wall019 LLC. (mlb) (Entered: 09/23/2022)

#4

(#4) New Case Notes: A filing fee is not due for this case. Pursuant to Misc. Order 6, Plaintiff is provided the Notice of Right to Consent to Proceed Before A U.S. Magistrate Judge (Judge Toliver). Clerk to provide copy to plaintiff if not received electronically. (mlb) (Entered: 09/23/2022)

#3

(#3) Request for Clerk to issue Summons filed by Securities and Exchange Commission. (Bernstein, Keefe) (Entered: 09/23/2022)

#2

(#2) CERTIFICATE OF INTERESTED PERSONS/DISCLOSURE STATEMENT by Securities and Exchange Commission. (Clerk QC note: No affiliate entered in ECF). (Bernstein, Keefe) (Entered: 09/23/2022)

1 #1

Cover Sheet

1 #1

Main Document

64 More Documents Available
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Docket Entries

  • 11/21/2022
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  • DocketUSCA Case Number 22-11132 in USCA5 for #66 Notice of Appeal filed by Timothy Barton. (svc) (Entered: 11/21/2022)

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  • 11/21/2022
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  • Docket(#68) AMENDED DOCUMENT by Bank of America, N.A.. Amendment to #50 Affidavit. . (Moeller, Evan) (Entered: 11/21/2022)

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  • 11/17/2022
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  • Docket(#67) STATUS REPORT Receiver's Initial Status Report filed by Receiver. (Thomas, Cort) (Entered: 11/17/2022)

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  • 11/17/2022
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  • Docket(#66) NOTICE OF INTERLOCUTORY APPEAL as to #63 Order on Motion for Miscellaneous Relief, 33 Order on Motion to Amend/Correct, #62 Order on Motion for Miscellaneous Relief, #29 Order on Motion for Miscellaneous Relief to the Fifth Circuit by Timothy Barton. Filing fee $505, receipt number ATXNDC-13311453. T.O. form to appellant electronically at #Transcript Order Form or US Mail as appropriate. Copy of NOA to be sent US Mail to parties not electronically noticed. IMPORTANT ACTION REQUIRED: Provide an electronic copy of any exhibit you offered during a hearing or trial that was admitted into evidence to the clerk of the district court within 14 days of the date of this notice. Copies must be transmitted as PDF attachments through ECF by all ECF Users or delivered to the clerk on a CD by all non-ECF Users. See detailed instructions #here. (Exception: This requirement does not apply to a pro se prisoner litigant.) Please note that if original exhibits are in your possession, you must maintain them through final disposition of the case. (Edney, Michael) (Entered: 11/17/2022)

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  • 11/16/2022
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  • Docket(#65) ELECTRONIC ORDER: The Court VACATES AS MOOT #61 Stephen T. Wall's Motion for Extension of Time to File Answer in light of #64 the Court's Order staying proceedings. (Ordered by Judge Brantley Starr on 11/16/2022) (chmb) (Entered: 11/16/2022)

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  • 11/16/2022
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  • Docket(#64) ORDER: The Court GRANTS #44 the United States of America's Motion to Intervene and Stay Proceedings. This proceeding is STAYED until otherwise ordered by the Court. Nothing in this Order shall prevent the Court-appointed Receiver from performing the duties and exercising the powers set forth in #29 the Court's Order Appointing Receiver, as supplemented by #62 the Court's Order Supplementing the Order Appointing Receiver. (Ordered by Judge Brantley Starr on 11/16/2022) (chmb) (Main Document 64 replaced on 11/16/2022) (rekc). (Entered: 11/16/2022)

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  • 11/16/2022
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  • Docket(#63) ORDER: The Court GRANTS the Receivers #47 Motion for Order Governing Administration of Receivership Estate, Etc. As to non-party HNGHs #51 Response and Objection, the Court withholds judgment regarding the ownership of real property located at 2999 Turtle Creek Boulevard, Dallas, Texas 75219, because that question is not yet properly before the Court. (Ordered by Judge Brantley Starr on 11/16/2022) (chmb) (Entered: 11/16/2022)

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  • 11/16/2022
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  • Docket(#62) ORDER: The Court GRANTS the Receivers #41 Motion to Supplement Order Appointing Receiver as detailed herein. As to non-party HNGHs #51 Response and Objection, the Court withholds judgment regarding the ownership of real property located at 2999 Turtle Creek Boulevard, Dallas, Texas 75219, because that question is not yet properly before the Court. (Ordered by Judge Brantley Starr on 11/16/2022) (chmb) (Entered: 11/16/2022)

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  • 11/16/2022
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  • Docket(#61) Agreed Motion for Extension of Time to File Answer Second Extension to File Answer Complaint filed by Stephen T Wall (Attachments: #1 Proposed Order) (Heiskell, Michael) (Entered: 11/16/2022)

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  • 11/16/2022
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  • Docket(#60) ELECTRONIC ORDER granting #59 Motion for Extension of Time to File Answer. (Ordered by Judge Brantley Starr on 11/16/2022) (chmb) (Entered: 11/16/2022)

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49 More Docket Entries
  • 09/28/2022
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  • Docket(#10) SUMMONS Returned Executed as to Timothy Barton ; served on 9/26/2022; Carnegie Development LLC ; served on 9/26/2022; DJD Land Partners LLC ; served on 9/26/2022; LDG001 LLC ; served on 9/26/2022; Stephen T Wall ; served on 9/26/2022; Wall007 LLC ; served on 9/26/2022; Wall009 LLC ; served on 9/26/2022; Wall010 LLC ; served on 9/26/2022; Wall011 LLC ; served on 9/26/2022; Wall012 LLC ; served on 9/26/2022; Wall016 LLC ; served on 9/26/2022; Wall017 LLC ; served on 9/26/2022; Wall018 LLC ; served on 9/26/2022; Wall019 LLC ; served on 9/26/2022. (Bernstein, Keefe) (Entered: 09/28/2022)

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  • 09/26/2022
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  • Docket(#9) ADDITIONAL ATTACHMENTS to #7 Appendix in Support by Plaintiff Securities and Exchange Commission. (Attachments: #1 Additional Page(s) Appendix Part 4 of 5, #2 Additional Page(s) Appendix Part 5 of 5) (Bernstein, Keefe) (Entered: 09/26/2022)

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  • 09/26/2022
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  • Docket(#8) ADDITIONAL ATTACHMENTS to #7 Appendix in Support by Plaintiff Securities and Exchange Commission. (Bernstein, Keefe) (Entered: 09/26/2022)

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  • 09/26/2022
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  • Docket(#7) Appendix in Support filed by Securities and Exchange Commission re #6 MOTION Plaintiff's Expedited Motion for Appointment of Receiver and Brief In Support (Attachments: #1 Additional Page(s) Part 1 of 5) (Bernstein, Keefe) (Entered: 09/26/2022)

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  • 09/26/2022
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  • Docket(#6) Expedited MOTION for Appointment of Receiver filed by Securities and Exchange Commission with Brief/Memorandum in Support. (Attachments: #1 Proposed Order) (Bernstein, Keefe) Modified text on 9/27/2022 (ygl). (Entered: 09/26/2022)

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  • 09/23/2022
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  • Docket(#5) Summons Issued as to Timothy Barton, Carnegie Development LLC, DJD Land Partners LLC, Haoqiang Fu, LDG001 LLC, Stephen T Wall, Wall007 LLC, Wall009 LLC, Wall010 LLC, Wall011 LLC, Wall012 LLC, Wall016 LLC, Wall017 LLC, Wall018 LLC, Wall019 LLC. (mlb) (Entered: 09/23/2022)

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  • 09/23/2022
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  • Docket(#4) New Case Notes: A filing fee is not due for this case. Pursuant to Misc. Order 6, Plaintiff is provided the Notice of Right to Consent to Proceed Before A U.S. Magistrate Judge (Judge Toliver). Clerk to provide copy to plaintiff if not received electronically. (mlb) (Entered: 09/23/2022)

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  • 09/23/2022
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  • Docket(#3) Request for Clerk to issue Summons filed by Securities and Exchange Commission. (Bernstein, Keefe) (Entered: 09/23/2022)

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  • 09/23/2022
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  • Docket(#2) CERTIFICATE OF INTERESTED PERSONS/DISCLOSURE STATEMENT by Securities and Exchange Commission. (Clerk QC note: No affiliate entered in ECF). (Bernstein, Keefe) (Entered: 09/23/2022)

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  • 09/23/2022
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  • Docket(#1) COMPLAINT WITH JURY DEMAND against Timothy Barton, Carnegie Development, LLC, DJD Land Partners, LLC, Haoqiang Fu (A/K/A Michael Fu), LDG001, LLC, Stephen T Wall, Wall007, LLC, Wall009, LLC, Wall010, LLC, Wall011, LLC, Wall012, LLC, Wall016, LLC, Wall017, LLC, Wall018, LLC, Wall019, LLC filed by Securities and Exchange Commission. (Filer fee note- Filed by the USA) Plaintiff will submit summons(es) for issuance. In each Notice of Electronic Filing, the judge assignment is indicated, and a link to the # Judges Copy Requirements and # Judge Specific Requirements is provided. The court reminds the filer that any required copy of this and future documents must be delivered to the judge, in the manner prescribed, within three business days of filing. Unless exempted, attorneys who are not admitted to practice in the Northern District of Texas must seek admission promptly. Forms, instructions, and exemption information may be found at www.txnd.uscourts.gov, or by clicking here: # Attorney Information - Bar Membership. If admission requirements are not satisfied within 21 days, the clerk will notify the presiding judge. (Attachments: #1 Cover Sheet) (Bernstein, Keefe) (Entered: 09/23/2022)

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