This case was last updated from PACER on 05/10/2021 at 07:38:22 (UTC).

Securities and Exchange Commission v. Kabylafkas

Case Summary

On March 11, 2021, the Securities and Exchange Commission (“SEC”), represented by David Misler attorney at the SEC’s New York Regional office filed a civil enforcement action against Nicholas “Niko” Kabylafkas (the “defendant”), seeking injunctive relief and disgorgement of all ill-gotten gains, among other reliefs, for his role in a fraudulent scheme to gain control of Airborne Wireless Network, promote its stock, and defraud investors. This case was filed in U.S. District Court in the Southern District of New York with Judge Colleen McMahon presiding

 

In its complaint, the SEC alleged that “The defendant, as explained further below, participated in a fraudulent scheme a group of individuals used to inflate Airborne’s stock price and sell millions of Airborne shares to unsuspecting investors to generate significant illicit proceeds. In particular, the defendant helped Kabilafkas solicit Scheffey’s investment in Airborne in exchange for Airborne stock and then deceived Airborne’s transfer agent and his broker in order to convince these market gatekeepers to issue new Airborne stock certificates in his name, accept those certificates for deposit in his brokerage account, and clear them for sale to the public.”

 

The SEC further alleged that “After purchasing the Ample-Tee shell in October 2015, Kabilafkas repeatedly made false and misleading statements and engaged in additional deceptive conduct to conceal his involvement with, and controlling interest in, Ample-Tee, as well as his acquisition of the S-1 Shares. For example, Kabilafkas placed the control block of restricted shares in the name of his nominee, Daniels.” The SEC also alleged that “Then, in August 2016, to help create the false appearance that Airborne was something other than a vehicle for Kabilafkas’s fraudulent scheme, Airborne bought from another company Kabilafkas controlled (“Private Company”) the patent that Airborne would use as the centerpiece of a deceptive promotional campaign. Kabilafkas also distributed S-1 Shares to family, friends, and associates, including Scheffey and the defendant. Kabilafkas, the defendant, and the others involved in the scheme then deceived Airborne’s transfer agent and their broker-dealers so that the transfer agent would transfer S-1 Shares into their names and the broker-dealers would accept them for deposits into their brokerage accounts where they could be timely liquidated during a promotional campaign.”

 

There are two claims for relief laid down by the SEC. The first claim is for violation of Securities Act Sections 17(a)(1)-(3) and second claim for relief is for Exchange Act Section 10(b) and Rule 10b-5 Thereunder. 

 

In its prayer for relief, the SEC has requested the court to permanently restrain and enjoin the defendant from violating the laws alleged in the complaint and barring the defendant from participating in an offering of penny stock pursuant to Section 21(d)(6) of the Exchange Act [15 U.S.C. § 78u(d)(6)]. The SEC further requested the court to disgorge all ill gotten gains with prejudgment interest, and order the defendant to pay a civil penalty pursuant to Section 20(d) of the Securities Act [15 U.S.C. § 77t(d)] and Section 21(d)(3) of the Exchange Act [15 U.S.C. §

78u(d)(3)]. 

 

This case summary may not reflect the current position of the parties to this litigation or the status of this case. Sign up to view the latest case updates and court documents.

 

Case Details Parties Documents Dockets

 

Case Details

  • Case Number:

    1:21-CV-02110

  • Filing Date:

    03/11/2021

  • Case Status:

    Disposed - Other Disposed

  • Case Type:

    Finance - Security/Commodity/Exchange

Judge Details

Presiding Judge

Colleen McMahon

 

Party Details

Plaintiff

Securities and Exchange Commission

Defendants

Nicholas Kabylafkas

Niko Kabylafkas

Attorney/Law Firm Details

Plaintiff Attorney

David Misler

Attorney at Securities and Exchange Commission (DC)

100 F Street, N.E.

Washington, DC 20549

 

Court Documents

#7

(#7) JUDGMENT AS TO DEFENDANT NICHOLAS KABYLAFKAS: IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that this Court shall retainjurisdiction of this matter for the purposes of enforcing the terms of this Judgment. IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that the Consent isincorporated herein with the same force and effect as if fully set forth herein, and that Defendantshall comply with all of the undertakings and agreements set forth therein. There being no just reason for delay, pursuant to Rule 54(b) of the Federal Rules of CivilProcedure, the Clerk is ordered to enter this Judgment forthwith and without further notice. (Signed by Judge Colleen McMahon on 3/22/2021) (nb) (Entered: 03/22/2021)

#6

(#6) MEMO ENDORSED ORDER granting #5 Motion to Approve Consent Judgment. ENDORSEMENT: Motion Granted. (Signed by Judge Colleen McMahon on 3/22/2021) (nb) (Entered: 03/22/2021)

#3

(#3) STATEMENT OF RELATEDNESS re: that this action be filed as related to 21-cv-1772 (CM). Document filed by Securities and Exchange Commission..(Misler, David) (Entered: 03/11/2021)

#2

(#2) CIVIL COVER SHEET filed..(Misler, David) (Entered: 03/11/2021)

#1

(#1) COMPLAINT against Nicholas Kabylafkas. Document filed by Securities and Exchange Commission..(Misler, David) (Entered: 03/11/2021)

 

Docket Entries

  • 03/22/2021
  • View Court Documents
  • Docket(#7) JUDGMENT AS TO DEFENDANT NICHOLAS KABYLAFKAS: IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that this Court shall retainjurisdiction of this matter for the purposes of enforcing the terms of this Judgment. IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that the Consent isincorporated herein with the same force and effect as if fully set forth herein, and that Defendantshall comply with all of the undertakings and agreements set forth therein. There being no just reason for delay, pursuant to Rule 54(b) of the Federal Rules of CivilProcedure, the Clerk is ordered to enter this Judgment forthwith and without further notice. (Signed by Judge Colleen McMahon on 3/22/2021) (nb) (Entered: 03/22/2021)

    Read MoreRead Less
  • 03/22/2021
  • View Court Documents
  • Docket(#6) MEMO ENDORSED ORDER granting #5 Motion to Approve Consent Judgment. ENDORSEMENT: Motion Granted. (Signed by Judge Colleen McMahon on 3/22/2021) (nb) (Entered: 03/22/2021)

    Read MoreRead Less
  • 03/19/2021
  • View Court Documents
  • Docket(#5) CONSENT MOTION to Approve Consent Judgment . Document filed by Securities and Exchange Commission. (Attachments: #1 Exhibit 1 - Consent, #2 Text of Proposed Order (Exhibit 2)).(Misler, David) (Entered: 03/19/2021)

    Read MoreRead Less
  • 03/16/2021
  • DocketMagistrate Judge Gabriel W. Gorenstein is so designated. Pursuant to 28 U.S.C. Section 636(c) and Fed. R. Civ. P. 73(b)(1) parties are notified that they may consent to proceed before a United States Magistrate Judge. Parties who wish to consent may access the necessary form at the following link: #https://nysd.uscourts.gov/sites/default/files/2018-06/AO-3.pdf. (laq) (Entered: 03/16/2021)

    Read MoreRead Less
  • 03/16/2021
  • DocketNOTICE OF CASE REASSIGNMENT to Judge Colleen McMahon. Judge Unassigned is no longer assigned to the case. (laq) (Entered: 03/16/2021)

    Read MoreRead Less
  • 03/16/2021
  • DocketCASE ACCEPTED AS RELATED. Create association to 1:21-cv-01772-CM. Notice of Assignment to follow. (laq) (Entered: 03/16/2021)

    Read MoreRead Less
  • 03/12/2021
  • DocketCASE REFERRED TO Judge Colleen McMahon as possibly related to 1;21-cv-1772 (CM). (gp) (Entered: 03/12/2021)

    Read MoreRead Less
  • 03/12/2021
  • DocketCase Designated ECF. (gp) (Entered: 03/12/2021)

    Read MoreRead Less
  • 03/12/2021
  • DocketCASE OPENING INITIAL ASSIGNMENT NOTICE: The above-entitled action is assigned to Judge Unassigned. .(gp) (Entered: 03/12/2021)

    Read MoreRead Less
  • 03/12/2021
  • Docket***NOTICE TO ATTORNEY REGARDING REMOVAL OF PARTY. Notice to attorney David Misler. The following party/parties has been removed from this case: ALIAS for Nicholas Kabylafkas. The party alias was added to the case in error. (gp) (Entered: 03/12/2021)

    Read MoreRead Less
  • 03/11/2021
  • View Court Documents
  • Docket>>>NOTICE REGARDING PRO HAC VICE MOTION. Regarding Document No. #4 MOTION for David Misler to Appear Pro Hac Vice . Motion and supporting papers to be reviewed by Clerk's Office staff.. The document has been reviewed and there are no deficiencies. (wb) (Entered: 03/11/2021)

    Read MoreRead Less
  • 03/11/2021
  • View Court Documents
  • Docket(#4) MOTION for David Misler to Appear Pro Hac Vice . Motion and supporting papers to be reviewed by Clerk's Office staff. Document filed by Securities and Exchange Commission. (Attachments: #1 Affidavit, #2 Text of Proposed Order, #3 Exhibit Certificate of Good Standing (DC), #4 Exhibit Certificate of Good Standing (MD)).(Misler, David) (Entered: 03/11/2021)

    Read MoreRead Less
  • 03/11/2021
  • View Court Documents
  • Docket(#3) STATEMENT OF RELATEDNESS re: that this action be filed as related to 21-cv-1772 (CM). Document filed by Securities and Exchange Commission..(Misler, David) (Entered: 03/11/2021)

    Read MoreRead Less
  • 03/11/2021
  • View Court Documents
  • Docket(#2) CIVIL COVER SHEET filed..(Misler, David) (Entered: 03/11/2021)

    Read MoreRead Less
  • 03/11/2021
  • View Court Documents
  • Docket(#1) COMPLAINT against Nicholas Kabylafkas. Document filed by Securities and Exchange Commission..(Misler, David) (Entered: 03/11/2021)

    Read MoreRead Less