SEC v. KEVAN CASEY; JONATHAN FRIEDLANDER; ADRIAN JAMES; and ROBERT WHEAT, No. 4:24-cv-02971, Southern District of Texas (Aug. 9, 2024) — Complaint

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION

CASE NO.  24-cv-2971

JURY

___________________________________________
)
SECURITIES AND EXCHANGE COMMISSION,    )
)
Plaintiff,                                )
)
v.         )
)
KEVAN CASEY, JONATHAN FRIEDLANDER,      ) JURY TRIAL DEMANDED
ADRIAN JAMES, and ROBERT WHEAT,   )
          )
                                    Defendants,                                       )
          )
VERTICAL HOLDINGS, LLC, DOVER HILL,  )
LLC, GSK STRATEGIES, LLC, CARMEL   )
VENTURES, LLC, ALS INVESTMENTS, LLC, )
HIGHBRIDGE CONSULTANTS, LLC, ADRIAN     )
JAMES AS THE TRUSTEE OF THE ASJ    )
LIVING TRUST, ESPORTS GROUP, INC., )
OAK GROVE ASSET MANAGEMENT, INC., )
and YSW HOLDINGS, INC.,   )
          )
                                    Relief            Defendants.                           )
___________________________________________ )

COMPLAINT
Plaintiff Securities and Exchange Commission (the “SEC” or “Commission”) alleges the
following against Defendants Kevan Casey (“Casey”), Jonathan Friedlander (“Friedlander”),
Adrian James (“James”) and Robert Wheat (“Wheat”) (collectively, “Defendants”), and Relief
Defendants Vertical Holdings, LLC (“Vertical Holdings”), Dover Hill, LLC (“Dover Hill”),
GSK Strategies, LLC (“GSK”), Carmel Ventures, LLC (“Carmel Ventures”), ALS Investments,
LLC (“ALS Investments”), Highbridge Consultants, LLC (“Highbridge Consultants”), Adrian
James as the Trustee of the ASJ Living Trust (“ASJ Living Trust”), Esports Group, Inc.

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(“Esports Group”), Oak Grove Asset Management, Inc. (“Oak Grove”), and YSW Holdings, Inc.
(“YSW Holdings”) (collectively, “Relief Defendants”):
INTRODUCTION
1. The Commission brings this action with respect to a multi-year securities fraud
scheme orchestrated by Kevan Casey.   The scheme involved Casey, either alone or with
combinations of his co-schemers acquiring a large quantity of shares in a series of “microcap”
companies at steep discounts, taking the companies public and/or direct marketing and stock
promotions recommending that the investing public purchase the stocks, and then selling
substantial amount of stock for enormous profits without disclosing his or his confederates’
ownership stakes, paid stock promotions, or material relationships with the companies.  These
companies were CNS Pharmaceuticals, Inc. (“CNS”), Soliton, Inc. (“Soliton”), Esports
Technologies Inc. n/k/a/ EBET, Inc. (“EBET”), Volcon, Inc. (“Volcon”) and Sidus Space, Inc.
(“Sidus Space”).  Casey and his co-defendants profited by at least $56 million from their
conduct, defrauding and harming investors who were deprived of disclosures required by law to
ensure fair and open access to material information about the companies, their promoters, and
the persons involved in these companies’ registered securities offerings.
2. Casey sometimes worked alone, and other times agreed with long-time friends
and business associates, co-defendants Adrian James and Jonathan Friedlander, to acquire, hold,
and dispose of the stock of these companies with the common objective of selling shares in the
open market at inflated values – all while out of the public eye.  As to one of the companies,
Casey, Friedlander, and their business associate co-defendant Robert Wheat concealed
themselves at the time of initiating the public sale of the company’s stock (commonly known as
“taking the company public”).  All three of them sold substantial numbers of shares in the first
days of public trading (collectively over $13 million worth), when the stock spiked by 800%
amid stock promotions Casey and Friedlander arranged.

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3. Defendants had roles in these microcap companies that required them to be
identified by name in SEC filings as public company promoters, selling shareholders, and/or
beneficial owners of more than 5% of the registered class of stock of the public company (“5%+
beneficial owners”).  Further, by having those roles, the law required certain additional
information concerning transactions or relationships they had with the companies to be
disclosed.  Casey, James, Friedlander and Wheat schemed to evade these disclosure
requirements by structuring their stock acquisitions through pass-through nominee entities
(nominally controlled by friends or family members), and using these nominee entities for the
submission of false information to the companies required to disclose such information in SEC
filings.  Casey, Friedlander, and James also failed to file their own required beneficial ownership
reports with the SEC.
4. The purpose for evasion was to avoid disclosing the Defendants’ identities as
significant shareholders of, and their material relationships to, these companies.  Casey,
Friedlander, and Wheat had all been named defendants in a series of recent private litigation in
federal and state courts about another microcap stock, LuxeYard Inc. (the “LuxeYard
Litigation”).  The scheme continued through at least December 2022 notwithstanding a
published appellate decision in 2019, in the middle of the scheme, containing detailed findings
that Casey – with the explicit use of Friedlander and others – took a microcap company, like the
companies at issue here, public and manipulated its stock to the loss of LuxeYard and its public
investors.
5. The disclosure requirements of the federal securities laws are meant to ensure the
investing public is aware of the involvement of certain individuals in public companies.  The
availability of these disclosures allows investors to evaluate the risks in deciding whether to
make investments.  These required disclosures are particularly important in high-risk areas such
as new microcap company offerings.  Defendants hid this information on the series of microcap

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companies here.  By remaining undisclosed, public trading commenced and continued without
the investing public knowing Defendants’ substantial involvement, their material relationships to
the companies, or the substance of material transactions they had entered into prior to the
companies’ securities offerings.
6. The false and misleading statements and omissions alleged in this Complaint were
material because a reasonable investor would have wanted to know the truth behind the
misstatements and omissions.  Of particular interest to investors would have been the fact that
Defendants – whether individually or, in the case of Friedlander and James with Casey, as a
“group” – were public company promoters, selling shareholders, and/or 5%+beneficial owners
(and, in those capacities, had entered into certain transactions with the company) of a risky
microcap company like LuxeYard.
7. As part of the scheme, Casey, James, and Friedlander also hired stock promoters
to publicly recommend the purchase of stock while intending to sell their own stock.  For
example, Casey and James hired – and personally compensated – a stock promoter in 2019 to
promote Soliton as they were registering shares for resale and other shares were becoming
available for public trading.  Casey and James sold substantial amounts of shares during and in
the wake of the stock promotions.  Casey and Friedlander then worked with the same stock
promoter (and others) to promote EBET stock at the time of its initial public offering (“IPO”) of
stock – when Casey and Friedlander sold approximately $11 million worth of EBET stock in the
open market.
8. As alleged in detail below, Defendants committed the following violations:
a. Casey violated Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933
(the “Securities Act”) [15 U.S.C. §§ 77e(a), 77e(c), 77q(a)] and Sections
10(b), 13(d), and 16(a) of the Securities Exchange Act of 1934
(“Exchange Act”) [15 U.S.C. §§ 78j(b), 78m(d), 78p(a)] and Rules 10b-5,

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13d-1, and 16a-3 thereunder [17 C.F.R. §§ 240.10b-5, 240.13d-1 and
240.16a-3].  Casey is also liable for violations of Section 10(b) of the
Exchange Act and Rule 10b-5(b) thereunder through or by means of
another person in violation of Section 20(b) of the Exchange Act [15
U.S.C. § 78t(b)].
b. Friedlander violated Section 17(a) of the Securities Act [15 U.S.C. §
77q(a)] and Sections 10(b), 13(d), and 16(a) of the Exchange Act [15
U.S.C. §§ 78j(b), 78m(d), 78p(a)] and Rules 10b-5, 13d-1, and 16a-3
thereunder [17 C.F.R. §§ 240.10b-5, 240.13d-1 and 240.16a-3].
Friedlander is also liable for violations of Section 10(b) of the Exchange
Act and Rule 10b-5(b) thereunder through or by means of another person
in violation of Section 20(b) of the Exchange Act [15 U.S.C. § 78t(b)].
c. James violated Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)]
and Sections 10(b) and 13(d) of the Exchange Act [15 U.S.C. §§ 78j(b),
78m(d)] and Rules 10b-5(a), 10b-5(c) and 13d-1 thereunder [17 C.F.R. §§
240.10b-5(a), 240.10b-5(c), 240.13d-1].
d. Wheat violated Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)]
and Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rules
10b-5(a) and 10b-5(c) thereunder [17 C.F.R. §§ 240.10b-5(a), 240.10b-
5(c)].  Wheat is also liable for violations of Section 10(b) of the Exchange
Act and Rule 10b-5(b) thereunder through or by means of another person
in violation of Section 20(b) of the Exchange Act [15 U.S.C. § 78t(b)].
9. The Commission seeks injunctive relief against Defendants, disgorgement of ill-
gotten gains and prejudgment interest thereon, civil money penalties, an order preventing
Defendants from engaging in transactions in penny stocks, and an order preventing them from

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acting as an officer or director of an issuer of a class of securities registered with the
Commission.
10. Relief Defendants Vertical Holdings, Dover Hill, GSK, Carmel Ventures, ALS
Investments, Highbridge Consultants, ASJ Living Trust, Esports Group, Oak Grove, and YSW
Holdings were nominee entities through which Casey, Friedlander, James, and/or Wheat
received and sold shares in the course of the Defendants’ scheme.  The Relief Defendants
received proceeds from the Defendants’ sale of stock during the period of their fraudulent
conduct and were thereby in possession of the Defendants’ ill-gotten gains.
DEFENDANTS AND RELIEF DEFENDANTS
11. Kevan Casey, age 52, resides in Houston, Texas.  Casey is self-employed.  Casey
is the manager and 100% beneficial owner of Relief Defendants Vertical Holdings, Dover Hill,
GSK, and Carmel Ventures through the Silver Creek Holdings Trust, of which he is the trustee
and sole beneficiary.  Vertical Holdings is a Colorado limited liability company.  Vertical
Holdings was a shareholder of Soliton from at least April 2018, CNS from at least December
2018, EBET from at least October 2020, Volcon from at least September 2020 and Sidus Space
from at least September 2021, and sold shares of those companies.  Dover Hill is a Wyoming
limited liability company.  Dover Hill was a shareholder of EBET from at least September 2020,
Volcon from at least October 2021 and Sidus Space from at least December 2021, and sold
shares of those companies.  GSK is a Wyoming limited liability company.  GSK was a
shareholder of CNS from at least April 2019, EBET from at least July 2020 and Volcon from at
least October 2020, and sold shares of those companies.  Carmel Ventures is a Wyoming limited
liability company.  Carmel Ventures was a shareholder of Soliton from at least August 2019, and
sold shares of Soliton.  Casey negotiated contracts on behalf of Vertical Holdings, Dover Hill,
GSK and Carmel Ventures and held control over the disposition of securities they held.
Although Casey appointed nominee managers of these entities, Casey directed the disposition of

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securities held by these entities.  Casey previously was an officer, director, and/or 10%
shareholder of three other public companies.
12. Jonathan Friedlander, age 42, resides in La Jolla, California.  Friedlander is
self-employed and is the sole beneficial owner of Relief Defendant Esports Group.  On or about
July 13, 2020, Friedlander formed Esports Group, a Wyoming corporation, using a nominee
officer as a vehicle for the specific purpose of owning stock in EBET.  Esports Group was a
shareholder of EBET from at least September 2020, and sold shares of EBET.  Friedlander
negotiated contracts on behalf of Esports Group and had control over the disposition of securities
it held.  Friedlander made decisions on whether to buy or to sell EBET securities in the
brokerage account of Esports Group.  Friedlander was named as a defendant in the LuxeYard
Litigation.  Friedlander has been an officer and/or director of several private companies.
13. Adrian James, age 49, resides in Austin, Texas.  James is self-employed and is
the manager and 100% beneficial owner of Relief Defendants ALS Investments and Highbridge
Consultants, and the trustee and sole living beneficiary of ASJ Living Trust.  James was a co-
founder and director of Volcon.  ALS Investments is a Wyoming limited liability company.
ALS Investments was a shareholder of Soliton from at least April 2018, and sold shares of
Soliton.  Highbridge Consultants is a Wyoming limited liability company.  Highbridge
Consultants was a shareholder of Soliton from at least February 2019, and sold shares of Soliton.
ASJ Living Trust is a trust formed under the laws of Texas.  ASJ Living Trust was a shareholder
of Soliton from at least April 2018, and sold shares of Soliton.  James negotiated contracts on
behalf of ALS Investments, Highbridge Consultants and ASJ Living Trust, and had control over
the disposition of securities they held.
14. Robert Wheat, age 44, resides in La Jolla, California.  Wheat is self-employed
and is the 100% beneficial owner of Relief Defendants Oak Grove and YSW Holdings.  On or
about July 13, 2020, Wheat approved the formation of YSW Holdings, a Wyoming corporation,

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using a nominee officer as a vehicle for the specific purpose of owning stock in EBET.  YSW
Holdings was a shareholder of EBET from at least September 2020, and sold shares of EBET.
YSW Holdings had no other business operations.  Wheat negotiated contracts on behalf of YSW
Holdings and had control over the disposition of securities it held.  YSW Holdings did not take
any actions in disposing EBET securities that were not approved by Wheat.  Wheat was the sole
source of YSW Holdings’ funding.  Wheat, at his instruction, received proceeds from YSW
Holdings’ sales of EBET stock.  Oak Grove was formed as a Nevada corporation in 2013 with
Wheat as the sole officer and director.  Oak Grove was a shareholder of EBET from at least
April 2021, and sold shares of EBET.  Wheat was named as a defendant in the LuxeYard
Litigation.  Wheat has been an officer and/or director of several private companies including one
which Wheat co-founded with Friedlander and in which Casey is an investor.
THE MICROCAP COMPANIES
15. CNS is a clinical-stage pharmaceutical company incorporated in Nevada and
headquartered in Houston, Texas.  Its common stock is registered with the Commission pursuant
to Section 12(b) of the Exchange Act and trades on the Nasdaq under the “CNSP” symbol or
ticker (a set of capital letters assigned to a security for trading purposes).  CNS commenced
public trading at $4.50 per share in November 2019 with a market capitalization of
approximately $62.8 million.  CNS currently trades for the equivalent of less than $0.01 per
share (as compared to its initial public trading price) with a market capitalization of
approximately $1.75 million.
16. Soliton was a medical device company incorporated in Delaware and
headquartered in Houston, Texas.  Its common stock was registered with the Commission
pursuant to Section 12(b) of the Exchange Act and traded on the Nasdaq under the “SOLY”
symbol or ticker.  Soliton commenced public trading at $5.00 per share in February 2019 with a
market capitalization of approximately $73 million.  Soliton was acquired by AbbVie, Inc. on

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December 16, 2021, and the registration of its common stock was terminated on December 28,
2021.
17. EBET is an online gambling platform operator incorporated in Nevada and
headquartered in Las Vegas, Nevada.  Its common stock is registered with the Commission
pursuant to Section 12(g) of the Exchange Act and is traded on OTCQB (whose parent company
is OTC Markets Group Inc.) under the “EBET” symbol or ticker after being delisted from the
Nasdaq.  EBET commenced public trading at $6.00 per share in April 2021 with a market
capitalization of approximately $62.4 million.  EBET’s stock currently trades for the equivalent
of less than $0.01 per share (as compared to its initial public trading price) with a market
capitalization of approximately $749,000.
18. Volcon is an electric off-road vehicle design and sales company incorporated in
Delaware and headquartered in Round Rock, Texas.  Its common stock is registered with the
Commission pursuant to Section 12(b) of the Exchange Act and is traded on the Nasdaq under
the “VLCN” symbol or ticker.  Volcon commenced public trading at $5.50 per share in October
2021 with a market capitalization of approximately $62.4 million.  Volcon stock currently trades
for the equivalent of less than $0.01 per share (as compared to its initial public trading price)
with a market capitalization of approximately $6.0 million.
19. Sidus Space, Inc. is a space exploration company incorporated in Delaware and
headquartered in Merritt Island, Florida.  Its common stock is registered under Section 12(b) of
the Exchange Act and is traded on the Nasdaq under the symbol “SIDU.”  Sidus Space
commenced public trading at $5.00 per share in December 2021 with a market capitalization of
$81 million.  Sidus Space stock currently trades for the equivalent of less than $0.03 per share
(as compared to its initial public trading price) with a market capitalization of approximately
$9.7 million.

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JURISDICTION AND VENUE
20. This Court has subject-matter jurisdiction over this action pursuant to Section
22(a) of the Securities Act [15 U.S.C. § 77v(a)] and Sections 21(d), 21(e), and 27 of the
Exchange Act [15 U.S.C. §§ 78u(d), 78u(e), 78aa].
21. The Court has personal jurisdiction over Defendants and Relief Defendants
because, among other things, all of the Defendants reside in the United States and all of the
Relief Defendants have principal places of business and transact business in the United States.
22. Venue lies in this District pursuant to Section 22(a) of the Securities Act [15
U.S.C. § 77v(a)] and Section 27 of the Exchange Act [15 U.S.C. § 78aa] because Defendant
Kevan Casey resides in Houston, Texas and has transacted business in this District.  Defendant
Casey’s business entity Vertical Holdings has a principal place of business in this District.
Casey’s co-defendants transacted business with him and/or his business entities while Casey was
located in this District.
23. In connection with the conduct alleged in this Complaint, Defendants, directly
and indirectly, singly or in concert with others, made use of the means or instruments of
transportation or communication in interstate commerce and of the mails.
FACTUAL ALLEGATIONS
A. Applicable Federal Securities Laws and Concepts
24. Defendants engaged in a fraudulent scheme to conceal their involvement and
holdings in companies that were “microcap stocks.”  These companies had stock that traded for
prices less than $5 per share, which are commonly known as “penny stocks.”  Microcap stocks
are those with lower market capitalizations, usually less than $250 to $300 million.  Microcap
companies typically have limited assets and operations.  They often have products and services
that are still in development or have yet to be tested in the market.  Their stocks tend to be low

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priced and trade in low volumes, making their prices subject to high volatility – meaning their
prices could have large swings up or down based on the volume of trading activity.
25. An initial public offering – or IPO – generally refers to when a company first sells
shares of its stock to the public.  Under the federal securities laws, a company may not lawfully
offer or sell shares unless the transaction has been registered with the SEC or an exemption
applies.  To register an offering, a company is required to file a registration statement with the
SEC, typically using Form S-1.  The registration statement provides information regarding the
terms of the securities being offered as well as disclosure regarding the company’s business,
financial condition, management and other matters that are key to deciding whether the offering
is a good investment.
26. Form S-1 registration statements must also disclose the name of any person who
within the past five years has acted as the company’s “promoter,” which in that context means
“any person who, acting alone or in conjunction with one or more other persons, directly or
indirectly takes initiative in founding and organizing the business or enterprise” (the “public
company promoter”).  Any thing of value the public company promoter received or will receive
from the company must also be disclosed along with the nature and amount of the things of
value.  Further, any assets acquired or to be acquired by the company from the public company
promoter must be disclosed along with the amount at which the assets were or are to be acquired,
the principle followed in determining such amount, and the identity of the person making that
determination.  If the assets were acquired by the promoter within two years prior to their
transfer to the company, the S-1 must also disclose the cost of the assets to the public company
promoter.
27. IPOs of all but the smallest of companies are offered to the public through an
underwriter, a firm that agrees to purchase the shares from the issuing company and then sell the
shares to investors.  The underwriter, typically in consultation with the company, decides on the

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basic terms and structure of the offering before trading starts, including the percentage of shares
sold to persons prior to the IPO – called allocations or subscriptions.
28. Underwriters typically sell allocations or subscriptions to institutional and
wealthy investors who are better able to buy large blocks of IPO shares, assume the financial
risk, and hold the investment for the long term.  Individual investors more often are able to
invest in new companies by purchasing shares when they are resold by the IPO subscribers in the
public market in the days following the IPO.
29. Pre-existing shareholders can also sell their shares in the IPO if their shares are
included in and registered as part of the offering.  Shares held by such shareholders are included
in the IPO and the shareholders are called “selling shareholders.”  The federal securities laws
contain a number of disclosure requirements as to selling shareholders.  The registration
statement discloses the number of shares each selling shareholder currently owns, plans to sell in
the offering, and will retain following the offering under Principal and Selling Shareholders or a
similarly captioned section.  Companies must also disclose any position, office or other material
relationship each selling shareholder has had with the company within the past three years, so
that public investors can discern the relationships the selling shareholders have had with the
company and what proportion of their respective holdings is being sold.
30. The trading price of a new publicly registered stock may be affected by a limited
supply of shares in the market immediately following an IPO.  The shares being traded on the
first day are generally only shares that were sold in or registered with the IPO.  All other
outstanding shares, such as those held by founders, early investors and employees that have not
been included in the IPO, may often not be sold in the public market so soon after the IPO, either
because they are “restricted securities” under the federal securities laws that can only be resold
without registration under certain circumstances, or because the existing shareholders have

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entered into a “lock-up agreement” in which they agree not to sell their shares for a certain
period of time, typically 180 days.
31. Stocks are susceptible to dramatic price movements in the first few days of public
trading given their stock prices are unsettled and the possibly heightened interest in new
companies, especially where hype is created around them.  In fact, some microcap companies
pay persons or entities to recommend or “tout” stock (“stock promoters”) in unsolicited
electronic communications, such as emails, texts, social media posts or internet chatrooms.
Federal securities laws require the disclosure of the source, amount, and type of compensation
for the promotion.  Furthermore, stock promoters – and those who direct them – are prohibited
under federal securities law from recommending the public to purchase the stock at the time they
are selling the stock.
32. The federal securities laws also require certain disclosures when a person or group
of persons who “agree to act together for the purpose of acquiring, holding, voting or disposing
of equity securities of an issuer” acquires beneficial ownership of more than five percent of a
registered class of a company’s equity securities.  First, those persons or groups are required to
file a Schedule 13D or 13G with the SEC.  Schedules 13D and 13G are commonly referred to as
“beneficial ownership reports.”  The term "beneficial owner" is defined under SEC rules.  It
includes any person who directly or indirectly has or shares voting power or investment power,
which includes the power to sell or direct the sale of the security.  Second, those persons or
groups – and certain transactions they have entered into with the issuer – must be identified in
registration statements and other company SEC filings.
B. Casey’s Background in Using Promotion of Public Companies to Profit from
Sale of Securities
33. In or about 2016, Casey began what became a serial process to generate securities
trading profits by acquiring significant ownership positions in microcap companies, shepherding

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them through the public securities offering process, and coordinating marketing and stock
promotion campaigns.  Casey initially identified future public companies through inventions
being developed at a local medical research center.  It was through this process that Casey met a
professor at the research center (the “Professor”).  In approximately 2015, Casey became
involved in Moleculin Biotech Inc. (“Moleculin”), a venture the Professor was founding with a
biotech executive (the “Moleculin/Soliton CEO”).  In addition to investing, Casey signed a
consulting agreement with Moleculin to work on investor relations and business operations.
Casey introduced Moleculin to an underwriter and lawyer he thereafter continued to use in the
ensuing scheme with other microcap companies.  Casey also worked with James, a long-time
friend, on marketing and other efforts to take Moleculin public.
34. Casey has used much the same pattern of conduct on subsequent microcap
companies (with details as to each company described below).  First, Casey embedded himself in
the company by amassing a large block of shares in the names of LLCs he controls and
positioning himself as a “consultant” to the company on various marketing and financing
matters, especially the going-public process.
35. Casey aimed to have the company list on the Nasdaq, sometimes looking to
minimally satisfy Nasdaq’s requirements for the listing of an IPO and other times looking for
“Nasdaq shells” for reverse merger.  In a reverse merger transaction, an existing public “shell
company,” which is usually a public reporting company with few or no operations, acquires a
private operating company whereby the shareholders of the private operating company exchange
their shares for a large majority of the shares of the public company. Although the public shell
company survives the merger, the private operating company’s shareholders gain a controlling
interest in the voting power and outstanding shares of stock of the public shell company. The
assets and business operations of the post-merger surviving public company are primarily, if not
solely, those of the former private operating company.

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36. Casey recruited friends to pose as the manager of entities through which he
purchased and sold shares.  Casey coordinated marketing and stock promotions before publicly
selling the shares held personally or in the names of those nominee entities.  Throughout, Casey
deliberately concealed his involvement from the investing public for a specific reason: the
LuxeYard Litigation.
C. Impact of the LuxeYard Litigation
37. Casey was experienced with securities reporting requirements.  From 2004 to
October 2010, Casey had filed at least 36 beneficial owner reports with the Commission as the
officer, director, and 10% shareholder of three public companies.  But then beginning in 2012
Casey was the central figure in the LuxeYard Litigation, a span of at least 38 private lawsuits in
federal and state courts across four states stemming from Casey’s orchestration of a fraudulent
manipulation of the stock of LuxeYard, a microcap company.
38. As stated in a Form 8-K publicly filed with the Commission in January 2013,
LuxeYard first “filed suit against Defendant Kevan Casey and his associates for manipulation of
the Company’s stock price.”  Casey settled the case within days of its filing.  Nonetheless, Casey
remained the main subject in several other lawsuits against his alleged co-conspirators, including
Friedlander, Wheat, and a friend who is one of the nominees Casey used here (“Casey Nominee
# 1”).
39. For example, in 2017, a trial court conducted a bench trial and entered a judgment
in favor of LuxeYard on its claim that Casey and others conspired in Casey’s violations of his
fiduciary duties as LuxeYard’s undisclosed control person.  In October 2019, the appellate court
affirmed the trial court with pages of factual findings of Casey’s misconduct, including 23
bulleted ways Casey controlled LuxeYard and enlisted, among others, Friedlander through the
going-public process and ensuing manipulation of the stock price amid stock promotion
campaigns.  For example, the court noted that Casey “gave Friedlander 2.5 million shares of

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free-trading stock in LuxeYard with instructions to sell them to fund the misleading advertising
in support of the pump-and-dump scheme.”  The published opinion also identified Casey
Nominee # 1 by name.
40. Casey understood that these findings were damaging, as broker-dealers
affirmatively closed his accounts based on their due diligence on him.  While taking a similar
role as he did with microcap LuxeYard on the series of microcap issuers here – and using some
of the same associates – Casey and the other Defendants purposefully hid themselves from the
investing public by, among other things, creating nominee entities with appointed officers,
subject to their control, to hold and dispose of their stock holdings, and falsely representing these
nominee entities (or their officers) as the only beneficial owners of the stock.  Defendants’
evasion of required disclosures harmed public investors who were deprived of material
information to assess the value of those securities and suffered aggravated pecuniary losses
given precipitous stock price drops in all the stocks during periods of their public trading.
D. CNS – Casey as Undisclosed Public Company Promoter
41. In 2017, Casey began working on what would become CNS.  After working with
Casey on Moleculin, the Professor approached Casey to help organize a business entity for
developing a drug technology currently licensed by the medical research center.
42. The Professor viewed himself and Casey as the “cofounders” of CNS.  Casey
provided initial funding for the venture through convertible promissory notes by which he could
convert the debt into shares at a rate of $0.0138 per share.  The entire note could be converted
upon an IPO (or “Qualified Offering”).
43. Casey worked together with the Professor to form what would become the public
company.  Casey helped select officers, directors and scientific advisory board members, and
introduced the Professor to CNS’s first CFO and incorporator.  After CNS was formed, but prior
to its IPO, Casey entered into a consulting agreement with CNS via his nominee entity GSK.

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CNS compensated Casey through GSK with a mix of cash and warrants. A warrant is a contract
that gives the holder the right to purchase from the company a certain number of additional
shares of common stock in the future at a certain price.
44. Casey then worked to take CNS public per the pattern described above.  Casey
provided comments on draft SEC filings, advised on press releases, assisted in the search for
additional drug technologies to add to the company’s portfolio, and introduced CNS to multiple
consultants.  Notably, Casey introduced the company to James, with whom Casey had also
worked on taking Moleculin public.  Pursuant to a consulting agreement identical to Casey’s,
James organized a crowdfunding campaign and advised on website design and contents,
marketing efforts, and investor materials.  Casey also approached a stock promoter, Ahmed
Alomari, to promote CNS around its IPO, and negotiated Alomari’s agreement with CNS.
45. All the while, Casey amassed millions of shares in CNS.  CNS began public
trading in November 2019 upon the effectiveness of a Form S-1 registration statement making
no mention of Casey.  Casey has not been mentioned in any other SEC filing regarding CNS.
46. In 2020 and 2021, Casey sold almost 2 million CNS shares on the open market.
Ultimately, Casey sold the remainder of his shares in CNS in 2022 after a disagreement with
CNS management about press release strategy.  Overall, Casey earned approximately $3.2
million in profits from his work on CNS while purposefully evading the legal requirements to
disclose his identity as a public company promoter of CNS.
E. Soliton - Casey and James as Undisclosed Group, Selling Shareholders, and
“Consultants”
47. At the same time as the CNS transactions were unfolding, Casey and James
worked even more closely together to take another microcap company, Soliton, public.  The
Moleculin/Soliton CEO was the Chief Executive Officer of both Moleculin and Soliton.  In early
2018, the Moleculin/Soliton CEO approached Casey and James jointly to see if they would

18
finance the still-developing company and work together to take it public.  According to the
Moleculin/Soliton CEO, he wanted Casey and James to be a “team of shareholders” based on his
experience working with them on Moleculin.
48. Casey conveyed to the Moleculin/Soliton CEO that he and James wanted to be
involved, together, in the process of preparing Soliton to make a public offering of stock.  In
April 2018, Casey and James agreed to invest the same amount of money in Soliton by signing
the same Note Purchase Agreement.  In return for each investing $125,000, Casey and James
received a convertible note by which they could convert the debt into shares of common stock at
a conversion rate of $0.175 per share upon a “Qualified Offering,” which was defined as an
offering of up to 2,000,000 shares (amended in August 2018 to 3,000,000 shares) at a price of at
least $5.00 per share.  The Note Purchase Agreement also gave Casey and James veto power
over pre-IPO financings below certain thresholds.
49. The Note Purchase Agreement also contained a “4.99% blocker” so that each of
Casey and James could not convert the note into shares of common stock that would cause either
of them individually to own more than 4.99% of Soliton’s registered class of stock.  Casey
wanted the blocker to avoid the requirement to file beneficial ownership reports with the SEC,
but the blockers did not prevent the legal requirement for Casey and James to disclose their
aggregate holdings.
50. Casey and James agreed amongst themselves not just to finance Soliton through
the same Note Purchase Agreement, but also to work together to take Soliton public.  Casey and
James sought to enter into a joint agreement with Soliton for compensation for their services.
On July 13, 2018, Casey emailed the Moleculin/Soliton CEO (copying James) to “modify the
[Moleculin] consulting agreement that I have for our Soliton arrangement and send it to us.”
Casey and James then sought hundreds of thousands of warrants and a “$200K+” cash

19
component in return for their services.  By email dated August 12, 2018, Casey further
negotiated the terms by which both he and James would be compensated for their services.
51. Casey and James did not reach a compensation agreement with Soliton prior to
the IPO.  Rather, Casey and James did all their pre-IPO work together to advance their common
goal to take Soliton public and later sell their shares in the public market.  The terms of their
Note Purchase Agreement underscored that they shared that common goal from the onset, as it
required Soliton to use its best efforts to commence a securities offering with the Commission
within 90 days.
52. Casey and James took a substantial role in the going-public process.  In
compliance with Casey and James’ Note Purchase Agreement, Soliton filed a draft registration
statement on June 15, 2018.  Whereas Casey and James had just recently purchased a note
convertible into shares at $0.1875 per share, the draft registration statement specified the IPO
price would be $5.00 per share.  Casey and James together worked with Soliton executives to
select the underwriter (Underwriter B), recruit investors, coordinate the timing and terms of pre-
IPO and IPO rounds, and formulate the marketing efforts and investor materials.  For example,
electronic calendar invitations reflect that from June 2018 until the IPO in February 2019,
Soliton executives invited Casey and James together to at least 27 private meetings regarding the
going-public process, with at least 8 of those meetings being with the IPO underwriter to discuss
such things as “IPO Strategy Discussion” and “IPO Timing and Assignments.”
53. Ultimately, both the volume and price of the Soliton IPO exactly matched the
minimum requirements of a “Qualified Offering” under Casey and James’ Note Purchase
Agreement – up to 3,000,000 shares at a price of at least $5.00 per share.  In other words, the
IPO was structured exactly to allow Casey and James to convert their notes into Soliton shares
upon the IPO.

20
54. Casey and James also agreed to sell some of their Soliton shares together to
support their Soliton objectives.  In 2018, Casey and James simultaneously sold the same
number of shares to W.R., a person in the business of assisting companies with the offer and sale
of securities, at the same discounted price to induce W.R. to assist Soliton in the going-public
process.  Casey and James agreed that they saw value in using W.R. and agreed to sell him
shares because it was a benefit to them both for W.R. to be involved in the offering of Soliton
stock.
55. After the IPO, Casey and James continued to work together on – and acquire and
sell shares of – Soliton with the same common objective.  Casey and James jointly negotiated
and simultaneously entered into identical Consulting Agreements with Soliton effective just a
few days after the IPO by which they each received 87,500 shares for the same scope of “public
markets” services.  Casey and James understood that they were receiving equal compensation
because Soliton viewed them as contributing services of substantially similar value to the
company’s efforts to make a public securities offering.
i.     Casey and James Agreed to Sell Stock Together to Pay for Promotions
56. Casey and James together approached stock promoter Alomari by email to
promote Soliton’s stock in March 2019.  Alomari has conducted stock promotional activities
through several means, including: (1) X f/k/a Twitter (under such names as IBuyCheapStocks
and CheapStocksUs); (2) Facebook; (3) Instagram; (4) the Investors Underground public chat
room; (5) Alomari’s www.nasdaqstocks.com website; and (6) “Nasdaq Stock Alerts” text blasts
to a list of phone numbers maintained by Alomari.
57. Casey and James approached Alomari weeks after Soliton’s IPO, and at a time
when Casey and James had shares becoming unrestricted.  By text dated March 3, 2019, James
told Alomari that Soliton “is going to be a great deal.”  That same day, Alomari told James he
would “make it happen for you guys.”

21
58. On March 6, 2019, Casey emailed Alomari (copying James) a detailed list of
anticipated promotions for Alomari to “[i]ntroduce the company to all of your twitter, email and
social media contacts,” and do “Message board posts – ongoing basis” and “Social media
outreach.”  Casey proposed for Alomari to be paid in cash by Soliton and “[s]eparately, Adrian
[James] and/or I [Casey] will sell” him stock at a steeply discounted price.
59. Two days later, on March 8, 2019, Alomari began promoting Soliton on Twitter.
Alomari coordinated the promotion with James by private chat, asking James to “[g]ive me three
competitor tickers” and other content.  Alomari then sent James a screenshot of a tweet (with
competitor tickers) from Alomari’s IBuyCheapStocks account: “$SOLY interesting concept.
Sexy theme w ultra low float Looking to swing this 1-2 months personal target $7+ #stocks
$TRIL $MBOT $DCAR $ADIL;” while Soliton stock was trading below $5 per share.
60. In stock equities, a “float” refers to the number of shares available for public
trading.  As noted above, microcap companies typically trade in lower volumes with fewer
shares outstanding (in other words, a “low float”), making their prices subject to larger price
swings based on trading activity.
61.   Later that afternoon, Alomari messaged James suggesting responsibility for
creating buying activity, saying: “Quick $200k in 100% PURE buying today.”  That same day,
Alomari also texted Casey and James “already rocking it for you guys.”
62. On March 12, 2019, Alomari tweeted again about Soliton as “Multi Billion dollar
market Ultra low float could rip $7-10+ easy,” while Soliton was publicly trading below $5 per
share.
63. Casey and James’ initial proposal to Alomari on behalf of Soliton included
compensation in the form of stock they would together “sell” him.  Alomari eventually signed a
“Consulting Agreement” with Soliton effective April 29, 2019, by which he would receive

22
25,000 shares of restricted Soliton stock, but Casey and James immediately thereafter agreed to
dispose some of their own unrestricted shares in exchange for these 25,000 shares.
64. Specifically, while Alomari kept promoting Soliton stock in May 2019, Casey and
James agreed with each other to immediately transfer the same number of unrestricted Soliton
shares that they personally owned (11,000 shares each) to Alomari in exchange for Alomari
agreeing to deliver his 25,000 restricted shares equally to them (12,500 shares each) six months
later.  On May 7, 2019, Casey sent Alomari and James identical “Option Agreements” by which
each of Casey and James would transfer the same number of shares (11,000) and later receive
the same number of shares (12,500) from Alomari.  Casey drafted the identical “Option
Agreements” on behalf of both himself and James.  Casey and James signed the identical
agreements, and transferred the same number of shares to Alomari in May-June 2019.
65. In April 2019, Casey and James made a similar sale of an identical number of
Soliton shares to Friedlander, to compensate him for losses in Casey and James’ prior public
company deal, Moleculin.
66. In addition to engaging Alomari for stock promotions, Casey and James together
formulated Soliton’s press and marketing strategy.  For example, by email dated May 9, 2019,
Casey emailed the Moleculin/Soliton CEO and Soliton’s CFO (copying James) with a detailed
schedule of 13 press and marketing events to take place between May 10, 2019 and June 7,
2019.  The Soliton CEO responded: “Looks like a good plan.”  Soliton’s CFO asked “what time
are we thinking for the [press] release on [May] 13
th
?”  Casey replied: “The press for next
Monday is to be released at 9AM EST.”
67. As of May 9, 2019, Casey’s press schedule already contained an entry for Soliton
to be receiving FDA approval regarding a Soliton product on May 28, 2019.  In fact, on May 28,
2019, Soliton issued a press release titled “Soliton Receives FDA 510(k) Clearance of its
Acoustic Shockwave RAP Device.”  That same day, Casey and James both deposited Soliton

23
shares in their brokerage accounts.  Casey started selling shares that day, and James started
selling shares the following day (the same day that Alomari posted a promotional article about
Soliton).  Between May 28, 2019 and June 5, 2019, Casey and James sold (either personally or
through entities they controlled) 176,500 shares and 101,600 Soliton shares for approximately
$3.4 million and $2.3 million in sales proceeds, respectively, in the public market.
ii.  Casey and James Evade Disclosing Their Identities in Required SEC Filings
68. Starting in June 2019, Casey and James jointly provided two more rounds of
financing to Soliton through the simultaneous purchase of over 1.2 million shares.  Soliton
agreed with Casey and James to register those shares for resale through the filing of two Form S-
1 registration statements.  Casey had Casey Nominee # 1 sign the agreements with Soliton for
the purchase and registration of the shares.
69. For a shareholder’s shares to be made part of a registration statement for resale,
the federal securities laws require the selling shareholder and any person with dispositive control
over the shares to be named.  The federal securities laws also require the disclosure of any
“material relationship which the selling security holder has had within the past three years with
the registrant or any of its predecessors or affiliates.”  The federal securities laws also require
“related party transactions” with 5%+ shareholders to be disclosed.
70. In August 2019 and November 2019, Soliton filed two Forms S-1 naming Casey
and James’ entities as “selling shareholders.”  Casey evaded disclosure in both filings by
directing his friend and LuxeYard co-defendant, Casey Nominee # 1, to pose as the control
person of the entity in whose name Casey purchased the shares, so that Casey Nominee # 1 – not
Casey – would be named in the Form S-1 as the person with dispositive control over the shares.
71. On June 28, 2019, Soliton’s counsel sent a draft of the first Form S-1 registration
statement to James and Casey Nominee # 1.  James was aware that Casey controlled the other

24
selling shareholder, and forwarded that email only to Casey (without copying Casey Nominee #
1).
72. One of the documents Casey directed Casey Nominee # 1 to sign was a Form S-1
“selling shareholder questionnaire” requested by Soliton.  Casey had Casey Nominee # 1 sign
several Soliton-related documents, including the questionnaire and agreements, using Casey
Nominee # 1’s middle name instead of his first name so Casey Nominee # 1’s identity would be
more difficult to trace given he was also a defendant in the LuxeYard Litigation.
73. The questionnaire expressly stated that it was for purposes of the company’s
preparation of a Form S-1 for the registration of the resale of the selling shareholder’s shares,
and was to be signed by the “undersigned beneficial owner” of the shares.  The questionnaire
also contained as “Exhibit A” a draft of the “Selling Stockholders” section of the Form S-1, with
a blank space where the persons or persons with “voting and dispositive power over the shares”
would be identified.
74. The questionnaire asked for four items to be completed, including “Full Legal
Name of Natural Control Person (which means a natural person who directly or indirectly alone
or with others has power to vote or dispose of the securities covered by this Questionnaire)” and
any “material relationship with the Company (or its predecessors or affiliates) during the past
three years.”  The Questionnaire expressly stated that “the undersigned consents to the disclosure
of the information contained herein in its answers to Items 1 through 4 and the inclusion of such
information in the Registration Statement” and “understands that such information will be relied
upon by the Company in connection with the preparation and amendment of the Registration
Statement.”
75. Casey submitted false selling shareholder questionnaires for the two Form S-1
registration statements filed by Soliton in August and November 2019.  Those questionnaires,
among other things, listed only Casey Nominee # 1 as the control person with dispositive control

25
over the shares (whereas Casey was).  The questionnaires also did not disclose any relationships
with Soliton, despite Casey’s Note Purchase Agreement, Consulting Agreement, and other
extensive involvement in taking Soliton public and promoting its stock.
76. The two Forms S-1 ultimately identified Casey Nominee # 1 (by his alias) – not
Casey.
77. James was aware of Casey’s role in the LuxeYard Litigation, in which the
appellate court published its extensive findings on Casey in October 2019 (between the filing of
the two Forms S-1).
78. Like Casey, James used a nominee as the purported sole control person of his
shares on the second Form S-1, when in fact James was that sole person with dispositive power
over that entity’s Soliton shares.  As a result, neither Casey nor James was named in the second
Form S-1 that went effective in November 2019.
79. The Forms S-1 also stated that the selling shareholders (entities 100% owned and
controlled by Casey and James) “ have not had any material relationship with [Soliton] other
than participating in prior securities offerings,” despite Casey and James’ Note Purchase
Agreement, Consulting Agreements, and other extensive involvement in taking Soliton public
and promoting its stock.    In fact, the Forms S-1 described both the Note Purchase Agreement
and Consulting Agreements, but not that they were with Casey or James.
80. Nor did the Forms S-1 or other SEC filings disclose that Casey and James were a
“group” owning more than 5% of the registered class of Soliton stock.  Nor did the Forms S-1 or
other SEC filings disclose Casey and James’ Note Purchase Agreement or Consulting
Agreements as related party transactions with 5%+ shareholders.

26
iii.  Casey and James Continue to Pay for Soliton Stock Promotions into Which
They Sell Their Soliton Stock
81.     Casey and James continued to sell Soliton securities as they jointly directed
Soliton’s press and marketing efforts in the midst of their joint purchase and registration of
Soliton shares.  On or about August 9, 2019, as the first Form S-1 for the resale of their shares
was pending, Casey and James together urgently sought Alomari’s help to promote Soliton.
Alomari spoke with Casey and James together, and proposed that Casey and James personally
compensate him for future stock promotions by foregoing their identical Option Agreements –
i.e. let Alomari keep the 25,000 shares he was to turn over equally to Casey and James (12,500
shares each).
82. Casey and James agreed with each other to accept Alomari’s offer to forgo their
options (worth at least $200,000 at the current market price) as payment for future promotions of
Soliton stock.  The day after Casey and James agreed to forgo their options, James instructed
Soliton’s CFO (copying Casey) to send Alomari materials to “cover it to his database.”  The
following day, Casey emailed another stock promoter the final version of a press release with
instructions to issue it after the market open, merely informing Soliton’s CFO of the timing and
cost of the promotion.
83. The day after that (August 12, 2019), Alomari sent out three text blasts on
Soliton, including: “Our alert on SOLY this morning @$8.80 hit a [sic] intraday high of $12.19
today!  Keep your eyes on SOLY over the next couple of weeks!”  On August 14, 2019, Alomari
sent out another text blast and posted an article on his website touting Soliton.  Starting the next
day, James publicly sold (personally or through entities he controlled) almost 100,000 shares for
approximately $1.2 million in sales proceeds over the remainder of August 2019.  Casey and
James then sold (personally or through entities they controlled) over 83,000 and 193,000 shares
for approximately $1.1 million and $2.5 million in sales proceeds, respectively, in September

27
2019, and 183,500 shares and 122,550 shares for approximately $2.2 million and $1.5 million in
sales proceeds, respectively, in October 2019.
84. Casey and James were both aware of Alomari’s text blasts, some of which had no
disclosure regarding Alomari’s compensation and no link to any article or other content.  On
August 20, 2019, Soliton received a complaint from a recipient of Alomari’s unsolicited text
blasts.  Soliton’s CFO forwarded the complaint to Casey and James and asked them to “please
have [Alomari] cease doing anything related to Soliton today until we get to the bottom of this.”
Attached to the complaint were copies of text blasts with no disclosure of Alomari’s
compensation, and other promotional materials with inaccurate disclosures of his compensation
by not mentioning Casey and James’ compensation.  James privately chatted with Alomari about
the text blast complaint, and thanked Alomari for contacting Soliton’s CFO about it.
85. Casey and James continued to sell (personally or through entities they controlled),
as Alomari continued to tout, Soliton stock throughout 2020.  Alomari frequently chatted with
Casey and James amid his continued promotion of Soliton stock in 2020.  For example, on July
6, 2020, Alomari sent Casey and James (in a private group chat) screenshots of an investor
chatroom, including Alomari’s post “I’m swinging for the fences.  Buyout target...”  Alomari
told Casey and James “Pay attention to the times plz.”  Also on July 6, 2020, Alomari sent Casey
and James a link to a Seeking Alpha article on Soliton.  James told Alomari and Casey that the
Seeking Alpha article did not appear to have a positive effect on the stock.  Alomari responded:
“I’ll distribute it and get some eyeballs on it.”  Later that day, Alomari sent Casey and James a
screenshot of a tweet “$SOLY MAJOR BOUNCE Potential and buyout target” with a link to the
Seeking Alpha article.  Casey and James both gave Alomari “thumbs up” symbols in the chat.
86. James (personally or through entities he controlled) sold Soliton shares in the
public market starting that day and on each of the following 12 trading days (July 6 to 23, 2020),
for a total of approximately 53,000 shares for approximately $438,000 in sales proceeds in the

28
public market.  Between July 7 and July 13, 2020, Casey (personally or through entities he
controlled) sold approximately 90,000 shares of Soliton stock for approximately $709,000 in
sales proceeds in the public market.
87. On September 11, 2020, Alomari texted Casey and James “About to give SOLY a
little nudge.”  An hour later Alomari texted Casey and James screenshots of multiple tweets and
Investors Underground posts he had made (with no disclosure of compensation), including
“Personal Target $10-12+ near term” when the stock traded under $7 per share.
88. On October 19, 2020, Alomari sent Casey and James screenshots of Twitter,
Instagram and Investors Underground posts promoting Soliton telling them: “We’re very close
guys.”  The Instagram post stated (without disclosure of compensation): “Your boy
#PennyStockAdvice always does right by you!  $9.30 and climbing.  Multi month break out.
200 ma test if we build above we’re looking at $10-12 fast.  2.2m shares are short and FDA and
other catalysts are coming.  Squeeze time. W[ith] approval could see $15++.”  The following
day, Alomari texted Casey and James: “SOLY protected...Can run now.”  In the remainder of
2020, Casey (personally or through entities he controlled) sold approximately 285,000 Soliton
shares for approximately $2.3 million in sales proceeds in the open market.
F. EBET – Casey, Friedlander and Wheat as Undisclosed Public Company
Promoters, Selling Shareholders, and/or Beneficial Owners

89. The next public company targeted by Casey as part of the fraudulent scheme
involved Friedlander and Wheat.  In May 2020, Casey and Friedlander identified an online
gaming business being run through a private Belize entity of which Friedlander’s business
associate was a member and director (the “Belize entity member/director”).  According to
Friedlander, Casey and Friedlander “work[ed] together” to jointly finance the private entity and
take the company through a public securities offering.

29
90. Casey and Friedlander first engaged Casey’s longtime underwriter, Underwriter
B, to help find a “Nasdaq shell” for a reverse merger.  On June 17, 2020, Casey created a private
group chat among Casey, Friedlander, and a principal of Underwriter B (the “Underwriter
Principal”).  On June 21, 2020, Casey and Friedlander told the Underwriter Principal they were
“concerned about the 3pc reporting requirement and being classified as acting as a group
potentially.”  Nonetheless, Casey texted the Underwriter Principal in the private group chat: “We
[Casey and Friedlander] had a couple of questions....Website and [PowerPoint] will be done and
sent to you on Monday” so Underwriter B could send it to shell candidates.
91. Casey and Friedlander continued to work with Underwriter B to find a shell
merger candidate into at least September 2020.  After several attempts at finding a shell, Casey
and Friedlander decided to take the private Belize entity public through an IPO.  To that end,
Casey and Friedlander guided the Belize entity member/director to form a new Nevada
corporation (as Casey did with CNS) as the business vehicle to make their planned public
securities offering.
92. On or about July 23, 2020, Casey, Friedlander, and their business associate Wheat
provided unsecured loans in the same amount to the private Belize entity.  Wheat knew the three
of them were lending the same amount to the private Belize entity, and knew the purpose of
Casey, Friedlander, and his loans was to pay to clean up the private Belize entity’s financial
books and records.
93. Registration statements must contain financial statements that are prepared by an
independent auditor.
94. Then, Casey, Friedlander, and Wheat – all three of whom were LuxeYard
Litigation defendants – devised how to acquire substantial amounts of shares in the soon-to-be
public company, but held in the name of persons other than them.  Friedlander and Wheat both
set up new Wyoming corporations, on the same day, for the specific purpose of acquiring and

30
holding shares in the private Belize entity.  Both Friedlander and Wheat set up these nominee
entities with nominee officers whom they controlled and with whom they had a relationship of
trust and confidence.  Friedlander used his father and Wheat used his personal attorney who
represented him in the LuxeYard Litigation.
95. In or about July and August 2020, Casey, Friedlander, and Wheat each bought
internet domains in the name of their nominee entities as a transactional front to receive
substantial amounts of shares in advance of their planned public securities offering.  Casey and
Friedlander agreed to acquire their shares together by purchasing internet domain names for
$30,000-$48,000 each through a nominee entity.  Friedlander identified domain names that were
available for sale, negotiated the purchase of the domain on behalf of Casey, and instructed
Casey to pay for the domain.
96. Meanwhile, on or about August 27, 2020, Wheat purchased domain names from
the private Belize entity member/director for $18,000 in the name of Wheat’s nominee entity,
YSW Holdings.
97. The sole purpose of Casey, Friedlander, and Wheat’s domain purchases was to
serve as a means to obtain shares in the soon-to-be public company while making it appear to be
a bona fide, arms-length transaction with the private Belize entity.  These transactions were not
arms-length.  Casey, Friedlander and Wheat extracted substantially more value from the
company than the domains were worth.  At the time they purchased the domains, Casey,
Friedlander, and Wheat had no intention to use those domains themselves.  Rather, even before
acquiring the domains, they intended to assign those domains to the private Belize entity in
return for an exorbitant number of shares compared to what they had to pay for the domains.
98. According to Casey, he and Wheat discussed purchasing domains around the time
Casey, Friedlander, and Wheat all purchased domains.  Casey understood that he, Friedlander,
and Wheat would each have agreements with the private Belize entity to transfer domains.

31
Casey drafted a “Domain Purchase Agreement” by which Casey, Friedlander, and Wheat each
would transfer the domains they had just purchased to the private Belize entity for a $700,000
promissory note convertible into 1,400,000 shares (a conversion rate of $0.50 per share) and a
warrant to purchase at least 635,000 additional shares at an exercise price of $0.30 per share.
Casey and Friedlander’s agreements also had a cash payment due from the private Belize entity
($375,000 for Friedlander, $300,000 for Casey).
99. Within days of Wheat’s purchase of domains from the private Belize entity
member/director, Casey, Friedlander, and Wheat entered into the Domain Purchase Agreements
with the same effective date of September 1, 2020.  Casey, Friedlander, and Wheat were aware
they had each entered into a similar Domain Purchase Agreement.  Each of Casey, Friedlander,
and Wheat had his nominee sign the Domain Purchase Agreement with their nominee entity as
the contracting party.  Those signed versions of the agreement were included as exhibits in the
Form S-1 registration statement.
100. The amounts Casey, Friedlander, and Wheat received under the Domain Purchase
Agreements were exorbitant compared to what they had just paid for the domains, especially in
light of the going rate for shares in the private Belize entity at the time.  Casey (in the name of
GSK) had purchased shares in July 2020 from the private Belize entity at $1.50 per share.
Moreover, on September 12, 2020, Casey texted a future EBET officer that a $2 pre-IPO round
was being “upsized” (i.e., enlarged) “based on demand.”  That same day, Casey texted Alomari
that the IPO would be priced at $5 per share.
101. At the $2 pre-IPO price, the 1,400,000 convertible shares alone of each of Casey,
Friedlander, and Wheat were worth $2,800,000 (versus domains just bought for as low as
$18,000).  Casey intended the consideration received under the agreement (convertible note,
warrants, and cash) to compensate all of his activities to prepare the company and take it through
the public securities offering.

32
102. Soon after their Domain Purchase Agreements, Casey, Friedlander, and Wheat
continued to take steps toward forming and launching the publicly traded company.  For
example, on or about September 21, 2020, an EBET officer invited Casey and Friedlander to a
“Weekly Update” with an agenda.  Friedlander forwarded the invitation to Wheat.  On or about
November 10, 2020, the same EBET officer invited Casey, Friedlander, and Wheat to a “Weekly
Board Update” that would be held on “Thursday moving forward per group request and
recurrence.  I will send an update ahead of the call as usual.”  Two day later, the same officer
sent to Casey, Friedlander, and Wheat an agenda for the “Weekly Board Update” that included
“S-1 Progress.”
103. In November 2020, EBET officers invited Casey, Friedlander, and Wheat to
several other calls and meetings, including a “Board Member Interview” and “ESEG
Jon/Kevan/Robert Weekly Update.”  “Weekly Catchup” invitations to Casey, Friedlander, and
Wheat continued into 2021.
104. On or about December 1, 2020, an EBET officer emailed Casey and Friedlander
about “meet and greets” with prospective investors.  Casey responded to the EBET officer and
added Wheat to the response.
105. As the IPO approached, on February 22, 2021, an EBET officer emailed Casey,
Friedlander, and Wheat an invitation to meet with a stock promoter with whom Casey had
previously worked on CNS and Soliton.
106. In or about December 2020, Casey, Friedlander, and Wheat simultaneously
bought shares from one of the founders of EBET’s predecessor.  Friedlander and Wheat
purchased the same number of shares at the same price.  On or about December 29, 2020,
EBET’s CFO sent Casey and Friedlander a draft agreement for each of Casey, Friedlander, and
Wheat’s entities to convert some of the shares under their Domain Purchase Agreements so that,

33
combined with the shares purchased from the EBET founder, each of Casey, Friedlander and
Wheat “will have 519,277 [shares] post conversion.”
107. Casey and Friedlander controlled the structure and timing of the IPO, which took
place in April 2021.  As early as September 2020, Casey and Friedlander told a future EBET
officer “We are aiming for $5 on the ipo.  Timing still the same.”  Casey and Friedlander
decided to register their and Wheat’s 519,277 shares as part of the IPO while “locking up” the
shares of the founders, officers, directors, and pre-IPO investors for several months.  Casey
drafted the lockup language with Friedlander, and sent it to the CFO to incorporate in
agreements and the Form S-1.
i.     Casey, Friedlander and Wheat Evade Legal Obligations to Disclose Their
Identities and Material Relationships to EBET.
108. In drafting the registration statement, EBET used a similar form “Selling
Shareholder Notice and Questionnaire” as Soliton.  On or about February 21, 2021, EBET’s
CFO sent Casey and Friedlander the form Selling Shareholder Questionnaire and asked: “Can
you guys get these filled out for each of the 4 entities represented on the selling shareholders
table?”  Those four entities were Casey’s, Friedlander’s, and Wheat’s nominee entities (Vertical
Holdings, Dover Hill, Esports Group, and YSW Holdings).
109. The Selling Shareholder Questionnaires for Casey, Friedlander, and Wheat’s
entities were all submitted within a two-day period.  On March 7, 2021, Friedlander sent an
already-completed Selling Shareholder Questionnaire to his father to sign.  That same day,
EBET received YSW Holdings’ completed Selling Shareholder Questionnaire, which named
only Wheat’s lawyer and disclosed no material relationship with EBET, its predecessors, or its
affiliates despite Wheat’s purchase of the domains from EBET’s predecessor’s member and
director (and control person of EBET’s largest shareholder) for which Wheat (via YSW

34
Holdings) was receiving, among other things, a convertible note worth 1.4 million shares in the
company.
110. On or about March 8, 2021, Casey replaced Casey Nominee # 1 with another
nominee (“Casey Nominee # 2”) as the purported manager of Vertical Holdings and Dover Hill.
However, Casey’s appointment of Casey Nominee # 2 was limited only purportedly “to handle
all dispositive (buying and selling) and voting control for all [EBET] shares.”  That same day,
Casey had Casey Nominee # 2 sign the Selling Shareholder Questionnaire for Vertical Holdings
and Dover Hill (naming only Casey Nominee # 2 and disclosing no material relationship) and
sent it to EBET.
111. On March 9, 2021, Friedlander’s wife sent to EBET Esports Group’s Selling
Shareholder Questionnaire, which named only his wife and disclosed no material relationships
with EBET, its predecessors, or its affiliates.
112. The three completed questionnaires were false and misleading in stating that the
nominees were the only control persons with dispositive and voting control over the shares.  The
completed questionnaires omitted the material information that Casey, Friedlander, and Wheat
had dispositive control.  According to Casey, he used nominees to keep his name out of SEC
filings given the LuxeYard Litigation, in which Friedlander and Wheat were also defendants.  So
instead of a Form S-1 disclosing three LuxeYard Litigation defendants as the selling
shareholders with agreements compensating them for efforts to take EBET public, the investing
public was given the false impression that three shareholders had no apparent connection to each
other and had merely sold domains to EBET at arms-length (versus as pre-determined
passthroughs to acquire exorbitant amounts of shares).
113. EBET’s Form S-1 registration statement, which included the three Domain
Purchase Agreements signed by the nominees as exhibits, was false and misleading in not
naming Casey, Friedlander, and Wheat as those with dispositive control over the shares.  The

35
Form S-1 also did not disclose that the Domain Purchase Agreements were compensation for not
just the transfer of domains, but also personal services and efforts to take EBET public.  Nor did
the Form S-1 disclose that Casey, Friedlander and Wheat planned to use the transactions to
extract more profit in future public securities offerings than they paid for the domains.
114. Nor did the registration statement disclose the principle followed in determining
the amount of consideration under the Domain Purchase Agreements, the identity of the person
making that determination, and the cost of the domains to Casey and Friedlander.  Nor did the
Form S-1 disclose that Wheat had just purchased the domains from the Belize entity
member/director for the purpose of receiving the securities.
115. Underwriter B took direction from Casey and Friedlander several times on the
EBET IPO, including how to allocate IPO shares with W.R., who was in the business of
assisting companies with the offer and sale of securities and whom Casey brought to the deal.
On March 31, 2021, the Underwriter Principal asked Casey and Friedlander in the private group
chat: “All SEC filings are in.  Do we want to launch the EBET IPO today with a April 12 pricing
and effectiveness, April 13 first trade on Nasdaq?” Casey responded: “Makes sense to me.”  The
Underwriter Principal replied: “Ok.”
116. On April 3, 2021, the Underwriter Principal asked Casey and Friedlander in the
private chat if they “want to do a call today to go over the EBET order book.”  On April 12,
2021, Casey asked the Underwriter Principal if he had “reserve[d] a nasdaq ipo slot for” April
15.  The Underwriter Principal responded: “What time preferred?”  Casey replied: “My opinion
is earlier the better.”  The Underwriter Principal confirmed later that evening: “Nasdaq has given
EBET the 9.50 to 10.00 [a.m.] Eastern trading open window.”
117. Casey, Friedlander, and Wheat also purchased additional shares in the IPO, and
almost immediately started selling substantial amounts in the public market.  Casey, Friedlander,
and Wheat subscribed to 146,376, 125,996, and 125,000 IPO shares in the names of Vertical

36
Holdings, Esports Group, and Oak Grove, respectively.  As a result of his purchase, Casey had
acquired in excess of 5% - and, together with Friedlander more than 10% - of EBET’s registered
class of securities.
ii.    Casey and Friedlander Paid for EBET Stock Promotions Into Which They Sold
EBET Stock.
118.   Casey and Friedlander engaged Alomari to promote EBET’s stock specifically at
the time of the IPO to try to boost market demand and increase the price into which they could
sell their shares.  Casey first told Alomari about EBET in September 2020 by private chat, with
Alomari telling Casey “Push for me I always give best effort but I’ll go above and beyond.”
Alomari soon entered a “Consulting Agreement” with EBET effective October 19, 2020, with an
“initial term of six months.”
119. Alomari’s first promotional activity on EBET was a post on an investor chatroom
on April 1, 2021, that “EBET IPO going to be a huge one imo.”  On April 2, 2021, Friedlander
started a Whatsapp group chat titled “Esports Intros,” and invited Alomari to join.  That same
day, Friedlander provided Alomari with contact information for EBET personnel, moderated
communications between Alomari and an EBET officer regarding social media accounts and
content, and discussed the activities of another stock promoter for EBET.
120. On April 9, 2021, Alomari texted Friedlander about EBET: “Are we all clear on
the IPO for [April 13] or is it pushed back?  I want to time things accordingly.”  Friedlander
responded: “Looking more like [April 15].”  On April 14, 2021, Casey sent Alomari a press
release announcing EBET’s IPO. Alomari responded: “Let’s f__ing go.”  Casey replied:
“Yepper.”
121. The EBET IPO was priced at $6.00 per share.  On April 15, 2021, the first day of
public trading, Alomari posted five times about EBET on Twitter and 8 times on Investors

37
Underground, an investor chatroom.  None of Alomari’s posts disclosed that he was being
compensated to promote EBET’s stock.
122. On that first day of public trading, several of Alomari’s posts compared EBET to
another issuer (UTime Ltd., ticker UTME) with an IPO the previous week where the shares
spiked 875% on the first day of public trading and another 133% on the second day of public
trading.  Near the end of EBET’s first trading day, Alomari posted: “EBET approaching HOD's
[highs of the day] eerily similar to UTME pull up a 60 min chart first 2 days.”  EBET’s stock
similarly soared by 800% on its first two days of public trading.
123. Back on Twitter at the end of the IPO day, the owner of Investors Underground
tweeted: “Great call this AM $EBET @CheapStocksUs crushed the call in the room pre market
wouldn’t have made my radar otherwise.”  On the second day of public trading, Casey,
Friedlander, and Wheat (through entities they controlled) sold 191,667, 72,900, and 79,200
shares for approximately $7.8 million, $3.1 million and $2.5 million in sales proceeds,
respectively, in the open market.
iii.   Casey Sells EBET Shares Subject to Restriction
124. Casey also sold EBET shares in the three months following the IPO in excess of
the amounts allowed under the federal securities laws.
125. Generally, the federal securities laws make it unlawful for any person to offer or
sell securities unless such offering or sale is registered with the Commission or is exempt from
registration under Commission rules.  Commission Rule 144 creates a safe harbor from the
registration requirement for persons seeking to resell securities that are not otherwise exempt
from the registration requirements.  The Rule imposes certain threshold requirements, including
a limit on the volume of shares that an “affiliate,” which is defined in part as a “person that
directly, or indirectly through one or more intermediaries, controls...such issuer,” can sell in any

38
three-month period.  These holding periods serve to restrict stock sales and prevent holders from
immediately dumping their stock into the public market.
126. Casey controlled EBET from its onset through the going-public process by
determining the organizational and capital structure (including whose shares would be registered
or locked up), timing the IPO, and structuring Domain Purchase Agreements to obtain millions
of dollars’ worth of securities for use in planned public securities offerings for a domain he had
just purchased for around $35,000.
127. EBET had 13,048,769 shares outstanding upon the IPO.  Casey (personally or
through entities he controlled) sold 393,460 EBET shares in the public market for approximately
$12.3 million in sales proceeds in the three-month period starting April 15, 2021.
G. Volcon and Sidus Space – Casey as Undisclosed Beneficial Owner
128. Casey’s next public company targeted as part of the scheme was Volcon, an
electric bike manufacturer of which James was a co-founder.  In October 2020, Casey signed a
“Consulting Agreement” by which he would receive a warrant to purchase 23,256 shares for
providing “business advisory services” for an initial 6-month term.  James signed the agreement
on behalf of Volcon.  According to James, Casey’s services were to find investors for Volcon.
129. In or about July 2021, Casey began to solicit friends and family to invest in the
Volcon IPO.  Casey lent hundreds of thousands of dollars to a number of these investors for
them to invest in the Volcon IPO.  The loans were interest-free and not in writing.  Casey also
put the investors in contact with the IPO underwriter to open brokerage accounts there.  Casey
eventually assembled 25 investors, including himself through three LLCs, to invest $11.5
million – over two-thirds of the offered shares – in the Volcon IPO.  Casey himself subscribed to
over 26% of the shares in the Volcon IPO through his three LLCs.
130. Casey also had preferred shares from pre-IPO investments which converted to
common stock upon the IPO.  Overall, Casey owned 8.9% of Volcon’s outstanding common

39
stock upon the IPO, and continued to own at least 5% for the first two months of public trading.
However, neither Casey’s ownership nor “consulting” relationship was ever disclosed in any
SEC filings.
131. Casey (personally or through entities he controlled) sold approximately 966,954
Volcon shares in the public market for approximately $11.9 million in sales proceeds from
October 8, 2021 to December 17, 2021.
132. In late 2021, Casey was approached by Underwriter B to invest in its upcoming
IPO for Sidus Space, a microcap space exploration company.  Casey purchased shares in both a
pre-IPO round and the IPO in December 2021.
133. At the time of the IPO, Casey owned 18.7% of Sidus Space’s registered class of
common stock.  Casey purchased more shares on the open market starting the first day of public
trading, owning a maximum of 37% of Sidus Space’s registered class.
134. In January 2022, Casey approached his lawyer about his Sidus Space holdings.  In
turn, his lawyer wrote to Sidus Space’s lawyer that “my clients are hoping to file their
[Schedule] 13G tomorrow,” and seeking a statement from Sidus Space that his clients did not
own over 10% of its common stock.
135. On April 21, 2022, Casey’s lawyer sent a letter to Sidus Space and Casey saying
he still represented “shareholders collectively representing more than 2 million [or 29% of all]
Class A shares.”  Casey continued to own at least 10% of the registered Class A shares through
December 2022.  However, at no time did Casey file any form or schedule with respect to his
ownership of Sidus Space shares.

40
CLAIMS FOR RELIEF
FIRST CLAIM FOR RELIEF
Violation of Section 17(a) of the Securities Act
(All Defendants)
136. The Commission repeats and incorporates by reference the allegations in
paragraphs 1-135 above.
137. By reason of the foregoing, each of Casey, Friedlander, James, and Wheat,
directly or indirectly, acting intentionally, knowingly, recklessly, or negligently, by use of the
means or instruments of transportation or communication in interstate commerce or by the use of
the mails, in the offer or sale of securities: (a) has employed or is employing devices, schemes,
or artifices to defraud; (b) has obtained money or property by making untrue statements of
material fact or omitting material facts necessary to make the statements made not misleading;
and (c) has engaged or is engaging in transactions, practices, or courses of business which
operated as a fraud or deceit upon the purchasers of such securities.
138. By reason of the conduct described above, each of Casey, Friedlander, James, and
Wheat violated, and unless enjoined will continue to violate, Section 17(a) of the Securities Act
[15 U.S.C. § 77q(a)].
SECOND CLAIM FOR RELIEF
Violations of Section 10(b) of the Exchange Act and Rule 10b-5 thereunder
(Casey and Friedlander)
139. The Commission repeats and incorporates by reference the allegations in
paragraphs 1-135 above.
140. By reason of the foregoing, each of Casey and Friedlander, directly or indirectly,
acting intentionally, knowingly or recklessly, in connection with the purchase or sale of
securities, by use of the means or instrumentalities of interstate commerce or the facilities of a

41
national securities exchange or the mail: (a) has employed or is employing devices, schemes, or
artifices to defraud; (b) has made or is making untrue statements of material fact or has omitted
to state material fact(s) necessary to make the statements made not misleading; and (c) has
engaged or is engaging in acts, practices, or courses of business which operate as a fraud or
deceit upon certain persons.
141. By engaging in the conduct described above, each of Casey and Friedlander
violated, and unless enjoined will continue to violate, Section 10(b) of the Exchange Act [15
U.S.C. § 78j(b)] and Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5].
THIRD CLAIM FOR RELIEF
Violations of Section 10(b) of the Exchange Act
and Rules 10b-5(a) and 10b-5(c) thereunder
(James and Wheat)
142. The Commission repeats and incorporates by reference the allegations in
paragraphs 1-135 above.
143. By reason of the foregoing, each of James and Wheat, directly or indirectly,
acting intentionally, knowingly or recklessly, in connection with the purchase or sale of
securities, by use of the means or instrumentalities of interstate commerce or the facilities of a
national securities exchange or the mail has employed or is employing devices, schemes, or
artifices to defraud; and has engaged or is engaging in acts, practices, or courses of business
which operate as a fraud or deceit upon certain persons.
144. By engaging in the conduct described above, each of James and Wheat violated,
and unless enjoined will continue to violate, Section 10(b) of the Exchange Act [15 U.S.C. §
78j(b)] and Rules 10b-5(a) and 10b-5(c) thereunder [17 C.F.R. §§ 240.10b-5(a), 10b-5(c)].

42
FOURTH CLAIM FOR RELIEF
Violations of Section 13(d) of the Exchange Act and Rule 13d-1 Thereunder
(Casey, Friedlander, and James)
145. The Commission repeats and incorporates by reference the allegations in
paragraphs 1-135 above.
146. Pursuant to Exchange Act Section 13(d) and Rule 13d-1 thereunder, persons who
are directly or indirectly the beneficial owners of more than 5% of the outstanding shares of a
class of voting equity securities registered under the Exchange Act are required to file a
Schedule 13D within ten days of the date on which their ownership exceeds five percent.  The
Schedule 13D filing requirement applies both to individuals and to two or more persons who act
as a group for the purpose of acquiring, holding, or disposing of securities of an issuer.
147. Casey and James constituted a group for the purposes of Exchange Act Section
13(d) and the Schedule 13D filing requirements with respect to Soliton.
148. Casey and Friedlander constituted a group for the purposes of Exchange Act
Section 13(d) and the Schedule 13D filing requirements with respect to EBET.
149. Casey was under an obligation to file with the Commission true and accurate
reports with respect to his ownership of Soliton, EBET, Volcon, and Sidus Space stock pursuant
to Exchange Act Section 13(d) and Rule 13d-1 thereunder, but failed to do so.
150. Friedlander was under an obligation to file with the Commission true and accurate
reports with respect to his ownership of EBET stock pursuant to Exchange Act Section 13(d)
and Rule 13d-1 thereunder, but failed to do so.
151. James was under an obligation to file with the Commission true and accurate
reports with respect to his ownership of Soliton stock pursuant to Exchange Act Section 13(d)
and Rule 13d-1 thereunder, but failed to do so.

43
152. By reason of the foregoing, Casey, Friedlander, and James violated, and, unless
enjoined and restrained will continue to violate, Section 13(d) of the Exchange Act, 15 U.S.C. §
78m(d), and Rule 13d-1 thereunder, 17 C.F.R. § 240.13d-1.
FIFTH CLAIM FOR RELIEF
Violations of Section 16(a) of the Exchange Act and Rule 16d-3 Thereunder
(Casey and Friedlander)
153. The Commission repeats and incorporates by reference the allegations in
paragraphs 1-135 above.
154. Casey and Friedlander, after acquiring directly or indirectly the beneficial
ownership of more than 10% of EBET’s class of equity securities registered pursuant to Section
12 of the Exchange Act [15 U.S.C. § 78l], failed to file with the Commission a Form 3 providing
an initial statement of beneficial ownership and, after effecting transactions in the securities,
failed to file with the Commission Forms 4 and 5 providing statements of changes in beneficial
ownership.
155. Casey, after acquiring directly or indirectly the beneficial ownership of more than
10% of Sidus Space’s class of equity securities registered pursuant to Section 12 of the
Exchange Act [15 U.S.C. § 78l], failed to file with the Commission a Form 3 providing an initial
statement of beneficial ownership and, after effecting transactions in the securities, failed to file
with the Commission Forms 4 and 5 providing statements of changes in beneficial ownership
156. By reason of the foregoing, Casey and Friedlander have violated, and unless
restrained and enjoined will in the future violate, Section 16(a) and Rule 16a-3 of the Exchange
Act, 15 U.S.C. § 78p(a) and 17 C.F.R. § 240.16a-3.

44
SIXTH CLAIM FOR RELIEF
Violations of Sections 5(a) and 5(c) of the Securities Act
(Casey)
157. The Commission repeats and incorporates by reference the allegations in
paragraphs 1-135 above.
158. Casey, directly or indirectly, has made use of the means or instruments of
transportation or communication in interstate commerce or of the mails to sell EBET securities,
when no registration statement was in effect with the Commission as to such securities, and has
made use of the means or instruments of transportation or communication in interstate
commerce or of the mails to offer to sell such securities when no registration statement had been
filed with the Commission as to such securities.
159. By reason of the foregoing, Casey violated, and unless restrained and enjoined
will continue to violate Sections 5(a) and 5(c) of the Securities Act [15 U.S.C. § 77e(a), (c)].
SEVENTH CLAIM FOR RELIEF
Violations of Section 20(b) of the Exchange Act
(Casey, Friedlander, and Wheat)
160. The Commission repeats and incorporates by reference the allegations in
paragraphs 1-135 above.
161. Casey violated Section 20(b) of the Exchange Act [15 U.S.C. § 78t(b)] by
knowingly or recklessly arranging for Casey Nominee # 1 and Casey Nominee # 2, whom Casey
named as the purported managers of Vertical Holdings and Dover Hill, to sign false selling
shareholder questionnaires submitted to Soliton and/or EBET.
162. By knowingly or recklessly arranging for the signing of these documents with
materially false and misleading information, Casey, directly or indirectly, through Casey
Nominee # 1 and Casey Nominee # 2, engaged in acts through or by means of third parties that

45
would have been unlawful for him to do himself under Section 10(b) of the Exchange Act, 15
U.S.C. § 78j(b), and Rule 10b-5(b) thereunder, 17 C.F.R. § 240.10b-5(b).
163. Friedlander violated Section 20(b) of the Exchange Act [15 U.S.C. § 78t(b)] by
knowingly or recklessly arranging for his wife, whom Friedlander named as the purported
officer and director of Esports Group, to sign a false selling shareholder questionnaire submitted
to EBET.
164. By knowingly or recklessly arranging for the signing of this document with
materially false and misleading information Friedlander, directly or indirectly, through his wife,
engaged in acts through or by means of a third party that would have been unlawful for him to
do himself under Section 10(b) of the Exchange Act, 15 U.S.C. § 78j(b), and Rule 10b-5(b)
thereunder, 17 C.F.R. § 240.10b-5(b).
165. Wheat violated Section 20(b) of the Exchange Act [15 U.S.C. § 78t(b)] by
knowingly or recklessly arranging for his personal lawyer, whom Wheat named as the purported
officer and director of YSW Holdings, to sign a false selling shareholder questionnaire submitted
to EBET.
166. By knowingly or recklessly arranging for the signing of this document with
materially false and misleading information, Wheat, directly or indirectly, through his personal
lawyer, engaged in acts through or by means of a third party that would have been unlawful for
him to do himself under Section 10(b) of the Exchange Act, 15 U.S.C. § 78j(b), and Rule 10b-
5(b) thereunder, 17 C.F.R. § 240.10b-5(b).
167. By reason of the foregoing, each of Casey, Friedlander, and Wheat violated, and,
unless enjoined, will continue to violate, Section 20(b) of the Exchange Act [15 U.S.C. § 78t(b)].

46
EIGHTH CLAIM FOR RELIEF
Unjust Enrichment
(All Relief Defendants)
168. The Commission repeats and incorporates by reference the allegations in
paragraphs 1-135 above.
169. Relief Defendants each obtained proceeds as part, and in furtherance, of the
securities law violations alleged above without a legitimate claim to those proceeds, and under
those circumstances it is not just, equitable or conscionable for them to retain the proceeds.
Relief Defendants were unjustly enriched.
170. Relief Defendants should each be ordered to disgorge the proceeds they received
as a result of the Defendants' violations of the federal securities laws.
RELIEF REQUESTED
WHEREFORE, the Commission requests that this Court find Defendants committed the
violations alleged, and:
A. Issue a permanent injunction prohibiting:
1. Casey from violating Sections 5(a), 5(c) and 17(a) of the Securities Act [15
U.S.C. §§ 77e(a), 77e(c), 77q(a)]  and Sections 10(b), 13(d), and 16(a) of the
Exchange Act [15 U.S.C. §§ 78j(b), 78m(d), 78p(a)] and Rules 10b-5, 13d-1,
and 16a-3 thereunder [17 C.F.R. §§ 240.10b-5, 240.13d-1 and 240.16a-3], and
prohibiting Casey from violating Section 20(b) of the Exchange Act [15
U.S.C. § 78t(b)];
2. Friedlander from violating Section 17(a) of the Securities Act [15 U.S.C. §
77e(a)] and Sections 10(b), 13(d), and 16(a) of the Exchange Act [15 U.S.C.
§§ 78j(b), 78m(d), 78p(a)] and Rules 10b-5, 13d-1, and 16a-3 thereunder [17

47
C.F.R. §§ 240.10b-5, 240.13d-1 and 240.16a-3], and prohibiting Friedlander
from violating Section 20(b) of the Exchange Act [15 U.S.C. § 78t(b)];
3. James from violating Section 17(a) of the Securities Act [15 U.S.C. § 77e(a)]
and Sections 10(b) and 13(d) of the Exchange Act [15 U.S.C. §§ 78j(b),
78m(d)] and Rules 10b-5(a), 10b-5(c) and 13d-1 thereunder [17 C.F.R. §§
240.10b-5(a), 240.10b-5(c), 240.13d-1];
4. Wheat from violating Section 17(a) of the Securities Act [15 U.S.C. § 77e(a)]
and Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5
thereunder [17 C.F.R. § 240.10b-5], and prohibiting Wheat from violating
Section 20(b) of the Exchange Act [15 U.S.C. § 78t(b)];
B. Issue a permanent injunction prohibiting:
1. Casey from directly or indirectly, including, but not limited to, through any
entity owned or controlled by Casey: (i) participating in the issuance,
purchase, offer, or sale of any security; (ii) being the controlling shareholder
of the issuer of any security (which term “controlling shareholder” means the
possession, direct or indirect, of the power to direct or cause the direction of
the management and policies of an issuer, whether through the ownership of
voting securities, by contract, or otherwise); (iii) promoting any issuer of any
security, causing the promotion of any issuer of any security, or deriving
compensation from the promotion of any issuer of any security; for purposes
of this injunction, ‘promoting’ or ‘promotion’ means, directly or indirectly,
publishing, giving publicity to, or circulating any form of written
communication, whether electronic or hard copy, the goal of which is to
generate interest in any security; or (iv) soliciting any person or entity to
purchase or sell any security, or to hold any security, as nominee; provided,

48
however, that such injunction shall not prevent Casey from purchasing or
selling securities listed on a national securities exchange for his own personal
account;
2. Friedlander from directly or indirectly, including, but not limited to, through
any entity owned or controlled by Friedlander: (i) participating in the
issuance, purchase, offer, or sale of any security; (ii) promoting any issuer of
any security, causing the promotion of any issuer of any security, or deriving
compensation from the promotion of any issuer of any security; for purposes
of this injunction, ‘promoting’ or ‘promotion’ means, directly or indirectly,
publishing, giving publicity to, or circulating any form of written
communication, whether electronic or hard copy, the goal of which is to
generate interest in any security; or (iii) soliciting any person or entity to
purchase or sell any security, or to hold any security, as nominee; provided,
however, that such injunction shall not prevent Friedlander from purchasing
or selling securities listed on a national securities exchange for his own
personal account;
3. James from directly or indirectly, including, but not limited to, through any
entity owned or controlled by James: (i) participating in the issuance,
purchase, offer, or sale of any security; (ii) promoting any issuer of any
security, causing the promotion of any issuer of any security, or deriving
compensation from the promotion of any issuer of any security; for purposes
of this injunction, ‘promoting’ or ‘promotion’ means, directly or indirectly,
publishing, giving publicity to, or circulating any form of written
communication, whether electronic or hard copy, the goal of which is to
generate interest in any security; or (iii) soliciting any person or entity to

49
purchase or sell any security, or to hold any security, as nominee; provided,
however, that such injunction shall not prevent James from purchasing or
selling securities listed on a national securities exchange for his own personal
account;
4. Wheat from directly or indirectly, including, but not limited to, through any
entity owned or controlled by Wheat, soliciting any person or entity to
purchase or sell any security, or to hold any security, as nominee;
C. Issue an Order directing Defendants and Relief Defendants to disgorge all ill-
gotten gains or proceeds received as a result of the acts and/or courses of conduct complained of
herein, with prejudgment interest thereon.
D. Issue an Order directing Defendants to pay a civil money penalty pursuant to
Section 20(d) of the Securities Act [15 U.S.C. § 77t(d)] and Section 21(d) of the Exchange Act
[15 U.S.C. § 78u(d)].
E. Issue an Order prohibiting Defendants pursuant to Section 20(g) of the Securities
Act [15 U.S.C. § 77t(g)] and Section 21(d)(6)(A) of the Exchange Act [15 U.S.C. §
78u(d)(6)(A)] from participating in an offering of penny stock, including engaging in activities
with a broker, dealer, or issuer for purposes of issuing, trading, or inducing or attempting to
induce the purchase or sale of any penny stock.
F. Enter a Final Judgment barring Defendants pursuant to Section 20(e) of the
Securities Act [15 U.S.C. § 77t(e)] and Section 21(d)(2) of the Exchange Act [15 U.S.C. §
78u(d)(2)] from acting as an officer or director of any issuer that has a class of securities
registered pursuant to Section 12 of the Exchange Act or that is required to file reports pursuant
to Section 15(d) of the Exchange Act.
G. Grant such other and further relief as may be necessary and appropriate.

50
H. Further, the Commission respectfully requests that the Court retain jurisdiction
over this action in order to implement and carry out the terms of all orders and decrees that it
may enter, or to entertain any suitable application or motion by the Commission for additional
relief within the jurisdiction of this Court.
JURY DEMAND
The Commission demands a jury in this matter for all claims so triable.
Respectfully submitted,
 SECURITIES AND EXCHANGE COMMISSION
 By its attorneys,

/s/David D’Addio
David J. D’Addio, Pro Hac Vice Motion Pending
Richard M. Harper II
Attorney-in-Charge
MA Bar No. 634782, Pro Hac Vice Motion Pending
Jeffrey T. Cook
Alexandra B. Lavin
Jonathan T. Menitove
U.S. Securities and Exchange Commission
Boston Regional Office
33 Arch Street, 24th Floor
Boston, MA 02110
(617) 573-8979 (Harper)
(617) 573-4590 (Facsimile)
[email protected]

Dated: August 9, 2024

UNITED STATES DISTRICT COURT 
SOUTHERN DISTRICT OF TEXAS 

HOUSTON DIVISION 
 

CASE NO.  24-cv-2971 
 

JURY 
 

___________________________________________ 
) 

SECURITIES AND EXCHANGE COMMISSION, ) 
) 

Plaintiff,   ) 
) 

v.      )  
) 

KEVAN CASEY, JONATHAN FRIEDLANDER,      ) JURY TRIAL DEMANDED 
ADRIAN JAMES, and ROBERT WHEAT,  ) 
       )    
   Defendants,   ) 
       ) 
VERTICAL HOLDINGS, LLC, DOVER HILL,  ) 
LLC, GSK STRATEGIES, LLC, CARMEL   ) 
VENTURES, LLC, ALS INVESTMENTS, LLC, ) 
HIGHBRIDGE CONSULTANTS, LLC, ADRIAN  ) 
JAMES AS THE TRUSTEE OF THE ASJ  ) 
LIVING TRUST, ESPORTS GROUP, INC., ) 
OAK GROVE ASSET MANAGEMENT, INC., ) 
and YSW HOLDINGS, INC.,   )  
       ) 
   Relief Defendants.  ) 
___________________________________________ ) 
 

COMPLAINT 

Plaintiff Securities and Exchange Commission (the “SEC” or “Commission”) alleges the 

following against Defendants Kevan Casey (“Casey”), Jonathan Friedlander (“Friedlander”), 

Adrian James (“James”) and Robert Wheat (“Wheat”) (collectively, “Defendants”), and Relief 

Defendants Vertical Holdings, LLC (“Vertical Holdings”), Dover Hill, LLC (“Dover Hill”), 

GSK Strategies, LLC (“GSK”), Carmel Ventures, LLC (“Carmel Ventures”), ALS Investments, 

LLC (“ALS Investments”), Highbridge Consultants, LLC (“Highbridge Consultants”), Adrian 

James as the Trustee of the ASJ Living Trust (“ASJ Living Trust”), Esports Group, Inc. 

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(“Esports Group”), Oak Grove Asset Management, Inc. (“Oak Grove”), and YSW Holdings, Inc. 

(“YSW Holdings”) (collectively, “Relief Defendants”): 

INTRODUCTION 

1. The Commission brings this action with respect to a multi-year securities fraud 

scheme orchestrated by Kevan Casey.   The scheme involved Casey, either alone or with 

combinations of his co-schemers acquiring a large quantity of shares in a series of “microcap” 

companies at steep discounts, taking the companies public and/or direct marketing and stock 

promotions recommending that the investing public purchase the stocks, and then selling 

substantial amount of stock for enormous profits without disclosing his or his confederates’ 

ownership stakes, paid stock promotions, or material relationships with the companies.  These 

companies were CNS Pharmaceuticals, Inc. (“CNS”), Soliton, Inc. (“Soliton”), Esports 

Technologies Inc. n/k/a/ EBET, Inc. (“EBET”), Volcon, Inc. (“Volcon”) and Sidus Space, Inc. 

(“Sidus Space”).  Casey and his co-defendants profited by at least $56 million from their 

conduct, defrauding and harming investors who were deprived of disclosures required by law to 

ensure fair and open access to material information about the companies, their promoters, and 

the persons involved in these companies’ registered securities offerings. 

2. Casey sometimes worked alone, and other times agreed with long-time friends 

and business associates, co-defendants Adrian James and Jonathan Friedlander, to acquire, hold, 

and dispose of the stock of these companies with the common objective of selling shares in the 

open market at inflated values – all while out of the public eye.  As to one of the companies, 

Casey, Friedlander, and their business associate co-defendant Robert Wheat concealed 

themselves at the time of initiating the public sale of the company’s stock (commonly known as 

“taking the company public”).  All three of them sold substantial numbers of shares in the first 

days of public trading (collectively over $13 million worth), when the stock spiked by 800% 

amid stock promotions Casey and Friedlander arranged.     

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3. Defendants had roles in these microcap companies that required them to be 

identified by name in SEC filings as public company promoters, selling shareholders, and/or 

beneficial owners of more than 5% of the registered class of stock of the public company (“5%+ 

beneficial owners”).  Further, by having those roles, the law required certain additional 

information concerning transactions or relationships they had with the companies to be 

disclosed.  Casey, James, Friedlander and Wheat schemed to evade these disclosure 

requirements by structuring their stock acquisitions through pass-through nominee entities 

(nominally controlled by friends or family members), and using these nominee entities for the 

submission of false information to the companies required to disclose such information in SEC 

filings.  Casey, Friedlander, and James also failed to file their own required beneficial ownership 

reports with the SEC.     

4. The purpose for evasion was to avoid disclosing the Defendants’ identities as 

significant shareholders of, and their material relationships to, these companies.  Casey, 

Friedlander, and Wheat had all been named defendants in a series of recent private litigation in 

federal and state courts about another microcap stock, LuxeYard Inc. (the “LuxeYard 

Litigation”).  The scheme continued through at least December 2022 notwithstanding a 

published appellate decision in 2019, in the middle of the scheme, containing detailed findings 

that Casey – with the explicit use of Friedlander and others – took a microcap company, like the 

companies at issue here, public and manipulated its stock to the loss of LuxeYard and its public 

investors.   

5. The disclosure requirements of the federal securities laws are meant to ensure the 

investing public is aware of the involvement of certain individuals in public companies.  The 

availability of these disclosures allows investors to evaluate the risks in deciding whether to 

make investments.  These required disclosures are particularly important in high-risk areas such 

as new microcap company offerings.  Defendants hid this information on the series of microcap 

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companies here.  By remaining undisclosed, public trading commenced and continued without 

the investing public knowing Defendants’ substantial involvement, their material relationships to 

the companies, or the substance of material transactions they had entered into prior to the 

companies’ securities offerings.   

6. The false and misleading statements and omissions alleged in this Complaint were 

material because a reasonable investor would have wanted to know the truth behind the 

misstatements and omissions.  Of particular interest to investors would have been the fact that 

Defendants – whether individually or, in the case of Friedlander and James with Casey, as a 

“group” – were public company promoters, selling shareholders, and/or 5%+beneficial owners 

(and, in those capacities, had entered into certain transactions with the company) of a risky 

microcap company like LuxeYard. 

7. As part of the scheme, Casey, James, and Friedlander also hired stock promoters 

to publicly recommend the purchase of stock while intending to sell their own stock.  For 

example, Casey and James hired – and personally compensated – a stock promoter in 2019 to 

promote Soliton as they were registering shares for resale and other shares were becoming 

available for public trading.  Casey and James sold substantial amounts of shares during and in 

the wake of the stock promotions.  Casey and Friedlander then worked with the same stock 

promoter (and others) to promote EBET stock at the time of its initial public offering (“IPO”) of 

stock – when Casey and Friedlander sold approximately $11 million worth of EBET stock in the 

open market.  

8. As alleged in detail below, Defendants committed the following violations: 

a. Casey violated Sections 5(a), 5(c), and 17(a) of the Securities Act of 1933 

(the “Securities Act”) [15 U.S.C. §§ 77e(a), 77e(c), 77q(a)] and Sections 

10(b), 13(d), and 16(a) of the Securities Exchange Act of 1934 

(“Exchange Act”) [15 U.S.C. §§ 78j(b), 78m(d), 78p(a)] and Rules 10b-5, 

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13d-1, and 16a-3 thereunder [17 C.F.R. §§ 240.10b-5, 240.13d-1 and 

240.16a-3].  Casey is also liable for violations of Section 10(b) of the 

Exchange Act and Rule 10b-5(b) thereunder through or by means of 

another person in violation of Section 20(b) of the Exchange Act [15 

U.S.C. § 78t(b)].   

b. Friedlander violated Section 17(a) of the Securities Act [15 U.S.C. § 

77q(a)] and Sections 10(b), 13(d), and 16(a) of the Exchange Act [15 

U.S.C. §§ 78j(b), 78m(d), 78p(a)] and Rules 10b-5, 13d-1, and 16a-3 

thereunder [17 C.F.R. §§ 240.10b-5, 240.13d-1 and 240.16a-3].  

Friedlander is also liable for violations of Section 10(b) of the Exchange 

Act and Rule 10b-5(b) thereunder through or by means of another person 

in violation of Section 20(b) of the Exchange Act [15 U.S.C. § 78t(b)]. 

c. James violated Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)] 

and Sections 10(b) and 13(d) of the Exchange Act [15 U.S.C. §§ 78j(b), 

78m(d)] and Rules 10b-5(a), 10b-5(c) and 13d-1 thereunder [17 C.F.R. §§ 

240.10b-5(a), 240.10b-5(c), 240.13d-1].   

d. Wheat violated Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)] 

and Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and Rules 

10b-5(a) and 10b-5(c) thereunder [17 C.F.R. §§ 240.10b-5(a), 240.10b-

5(c)].  Wheat is also liable for violations of Section 10(b) of the Exchange 

Act and Rule 10b-5(b) thereunder through or by means of another person 

in violation of Section 20(b) of the Exchange Act [15 U.S.C. § 78t(b)]. 

9. The Commission seeks injunctive relief against Defendants, disgorgement of ill-

gotten gains and prejudgment interest thereon, civil money penalties, an order preventing 

Defendants from engaging in transactions in penny stocks, and an order preventing them from 

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acting as an officer or director of an issuer of a class of securities registered with the 

Commission.   

10. Relief Defendants Vertical Holdings, Dover Hill, GSK, Carmel Ventures, ALS 

Investments, Highbridge Consultants, ASJ Living Trust, Esports Group, Oak Grove, and YSW 

Holdings were nominee entities through which Casey, Friedlander, James, and/or Wheat 

received and sold shares in the course of the Defendants’ scheme.  The Relief Defendants 

received proceeds from the Defendants’ sale of stock during the period of their fraudulent 

conduct and were thereby in possession of the Defendants’ ill-gotten gains.   

DEFENDANTS AND RELIEF DEFENDANTS 

11. Kevan Casey, age 52, resides in Houston, Texas.  Casey is self-employed.  Casey 

is the manager and 100% beneficial owner of Relief Defendants Vertical Holdings, Dover Hill, 

GSK, and Carmel Ventures through the Silver Creek Holdings Trust, of which he is the trustee 

and sole beneficiary.  Vertical Holdings is a Colorado limited liability company.  Vertical 

Holdings was a shareholder of Soliton from at least April 2018, CNS from at least December 

2018, EBET from at least October 2020, Volcon from at least September 2020 and Sidus Space 

from at least September 2021, and sold shares of those companies.  Dover Hill is a Wyoming 

limited liability company.  Dover Hill was a shareholder of EBET from at least September 2020, 

Volcon from at least October 2021 and Sidus Space from at least December 2021, and sold 

shares of those companies.  GSK is a Wyoming limited liability company.  GSK was a 

shareholder of CNS from at least April 2019, EBET from at least July 2020 and Volcon from at 

least October 2020, and sold shares of those companies.  Carmel Ventures is a Wyoming limited 

liability company.  Carmel Ventures was a shareholder of Soliton from at least August 2019, and 

sold shares of Soliton.  Casey negotiated contracts on behalf of Vertical Holdings, Dover Hill, 

GSK and Carmel Ventures and held control over the disposition of securities they held.  

Although Casey appointed nominee managers of these entities, Casey directed the disposition of 

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securities held by these entities.  Casey previously was an officer, director, and/or 10% 

shareholder of three other public companies.   

12. Jonathan Friedlander, age 42, resides in La Jolla, California.  Friedlander is 

self-employed and is the sole beneficial owner of Relief Defendant Esports Group.  On or about 

July 13, 2020, Friedlander formed Esports Group, a Wyoming corporation, using a nominee 

officer as a vehicle for the specific purpose of owning stock in EBET.  Esports Group was a 

shareholder of EBET from at least September 2020, and sold shares of EBET.  Friedlander 

negotiated contracts on behalf of Esports Group and had control over the disposition of securities 

it held.  Friedlander made decisions on whether to buy or to sell EBET securities in the 

brokerage account of Esports Group.  Friedlander was named as a defendant in the LuxeYard 

Litigation.  Friedlander has been an officer and/or director of several private companies.   

13. Adrian James, age 49, resides in Austin, Texas.  James is self-employed and is 

the manager and 100% beneficial owner of Relief Defendants ALS Investments and Highbridge 

Consultants, and the trustee and sole living beneficiary of ASJ Living Trust.  James was a co-

founder and director of Volcon.  ALS Investments is a Wyoming limited liability company.  

ALS Investments was a shareholder of Soliton from at least April 2018, and sold shares of 

Soliton.  Highbridge Consultants is a Wyoming limited liability company.  Highbridge 

Consultants was a shareholder of Soliton from at least February 2019, and sold shares of Soliton.  

ASJ Living Trust is a trust formed under the laws of Texas.  ASJ Living Trust was a shareholder 

of Soliton from at least April 2018, and sold shares of Soliton.  James negotiated contracts on 

behalf of ALS Investments, Highbridge Consultants and ASJ Living Trust, and had control over 

the disposition of securities they held. 

14. Robert Wheat, age 44, resides in La Jolla, California.  Wheat is self-employed 

and is the 100% beneficial owner of Relief Defendants Oak Grove and YSW Holdings.  On or 

about July 13, 2020, Wheat approved the formation of YSW Holdings, a Wyoming corporation, 

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using a nominee officer as a vehicle for the specific purpose of owning stock in EBET.  YSW 

Holdings was a shareholder of EBET from at least September 2020, and sold shares of EBET.  

YSW Holdings had no other business operations.  Wheat negotiated contracts on behalf of YSW 

Holdings and had control over the disposition of securities it held.  YSW Holdings did not take 

any actions in disposing EBET securities that were not approved by Wheat.  Wheat was the sole 

source of YSW Holdings’ funding.  Wheat, at his instruction, received proceeds from YSW 

Holdings’ sales of EBET stock.  Oak Grove was formed as a Nevada corporation in 2013 with 

Wheat as the sole officer and director.  Oak Grove was a shareholder of EBET from at least 

April 2021, and sold shares of EBET.  Wheat was named as a defendant in the LuxeYard 

Litigation.  Wheat has been an officer and/or director of several private companies including one 

which Wheat co-founded with Friedlander and in which Casey is an investor.   

THE MICROCAP COMPANIES 

15. CNS is a clinical-stage pharmaceutical company incorporated in Nevada and 

headquartered in Houston, Texas.  Its common stock is registered with the Commission pursuant 

to Section 12(b) of the Exchange Act and trades on the Nasdaq under the “CNSP” symbol or 

ticker (a set of capital letters assigned to a security for trading purposes).  CNS commenced 

public trading at $4.50 per share in November 2019 with a market capitalization of 

approximately $62.8 million.  CNS currently trades for the equivalent of less than $0.01 per 

share (as compared to its initial public trading price) with a market capitalization of 

approximately $1.75 million.   

16. Soliton was a medical device company incorporated in Delaware and 

headquartered in Houston, Texas.  Its common stock was registered with the Commission 

pursuant to Section 12(b) of the Exchange Act and traded on the Nasdaq under the “SOLY” 

symbol or ticker.  Soliton commenced public trading at $5.00 per share in February 2019 with a 

market capitalization of approximately $73 million.  Soliton was acquired by AbbVie, Inc. on 

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December 16, 2021, and the registration of its common stock was terminated on December 28, 

2021.   

17. EBET is an online gambling platform operator incorporated in Nevada and 

headquartered in Las Vegas, Nevada.  Its common stock is registered with the Commission 

pursuant to Section 12(g) of the Exchange Act and is traded on OTCQB (whose parent company 

is OTC Markets Group Inc.) under the “EBET” symbol or ticker after being delisted from the 

Nasdaq.  EBET commenced public trading at $6.00 per share in April 2021 with a market 

capitalization of approximately $62.4 million.  EBET’s stock currently trades for the equivalent 

of less than $0.01 per share (as compared to its initial public trading price) with a market 

capitalization of approximately $749,000. 

18. Volcon is an electric off-road vehicle design and sales company incorporated in 

Delaware and headquartered in Round Rock, Texas.  Its common stock is registered with the 

Commission pursuant to Section 12(b) of the Exchange Act and is traded on the Nasdaq under 

the “VLCN” symbol or ticker.  Volcon commenced public trading at $5.50 per share in October 

2021 with a market capitalization of approximately $62.4 million.  Volcon stock currently trades 

for the equivalent of less than $0.01 per share (as compared to its initial public trading price) 

with a market capitalization of approximately $6.0 million. 

19. Sidus Space, Inc. is a space exploration company incorporated in Delaware and 

headquartered in Merritt Island, Florida.  Its common stock is registered under Section 12(b) of 

the Exchange Act and is traded on the Nasdaq under the symbol “SIDU.”  Sidus Space 

commenced public trading at $5.00 per share in December 2021 with a market capitalization of 

$81 million.  Sidus Space stock currently trades for the equivalent of less than $0.03 per share 

(as compared to its initial public trading price) with a market capitalization of approximately 

$9.7 million. 

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JURISDICTION AND VENUE 

20. This Court has subject-matter jurisdiction over this action pursuant to Section 

22(a) of the Securities Act [15 U.S.C. § 77v(a)] and Sections 21(d), 21(e), and 27 of the 

Exchange Act [15 U.S.C. §§ 78u(d), 78u(e), 78aa]. 

21. The Court has personal jurisdiction over Defendants and Relief Defendants 

because, among other things, all of the Defendants reside in the United States and all of the 

Relief Defendants have principal places of business and transact business in the United States.   

22. Venue lies in this District pursuant to Section 22(a) of the Securities Act [15 

U.S.C. § 77v(a)] and Section 27 of the Exchange Act [15 U.S.C. § 78aa] because Defendant 

Kevan Casey resides in Houston, Texas and has transacted business in this District.  Defendant 

Casey’s business entity Vertical Holdings has a principal place of business in this District.  

Casey’s co-defendants transacted business with him and/or his business entities while Casey was 

located in this District.  

23. In connection with the conduct alleged in this Complaint, Defendants, directly 

and indirectly, singly or in concert with others, made use of the means or instruments of 

transportation or communication in interstate commerce and of the mails.    

FACTUAL ALLEGATIONS 

A. Applicable Federal Securities Laws and Concepts 

24. Defendants engaged in a fraudulent scheme to conceal their involvement and 

holdings in companies that were “microcap stocks.”  These companies had stock that traded for 

prices less than $5 per share, which are commonly known as “penny stocks.”  Microcap stocks 

are those with lower market capitalizations, usually less than $250 to $300 million.  Microcap 

companies typically have limited assets and operations.  They often have products and services 

that are still in development or have yet to be tested in the market.  Their stocks tend to be low 

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priced and trade in low volumes, making their prices subject to high volatility – meaning their 

prices could have large swings up or down based on the volume of trading activity.   

25. An initial public offering – or IPO – generally refers to when a company first sells 

shares of its stock to the public.  Under the federal securities laws, a company may not lawfully 

offer or sell shares unless the transaction has been registered with the SEC or an exemption 

applies.  To register an offering, a company is required to file a registration statement with the 

SEC, typically using Form S-1.  The registration statement provides information regarding the 

terms of the securities being offered as well as disclosure regarding the company’s business, 

financial condition, management and other matters that are key to deciding whether the offering 

is a good investment.   

26. Form S-1 registration statements must also disclose the name of any person who 

within the past five years has acted as the company’s “promoter,” which in that context means 

“any person who, acting alone or in conjunction with one or more other persons, directly or 

indirectly takes initiative in founding and organizing the business or enterprise” (the “public 

company promoter”).  Any thing of value the public company promoter received or will receive 

from the company must also be disclosed along with the nature and amount of the things of 

value.  Further, any assets acquired or to be acquired by the company from the public company 

promoter must be disclosed along with the amount at which the assets were or are to be acquired, 

the principle followed in determining such amount, and the identity of the person making that 

determination.  If the assets were acquired by the promoter within two years prior to their 

transfer to the company, the S-1 must also disclose the cost of the assets to the public company 

promoter. 

27. IPOs of all but the smallest of companies are offered to the public through an 

underwriter, a firm that agrees to purchase the shares from the issuing company and then sell the 

shares to investors.  The underwriter, typically in consultation with the company, decides on the 

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basic terms and structure of the offering before trading starts, including the percentage of shares 

sold to persons prior to the IPO – called allocations or subscriptions.   

28. Underwriters typically sell allocations or subscriptions to institutional and 

wealthy investors who are better able to buy large blocks of IPO shares, assume the financial 

risk, and hold the investment for the long term.  Individual investors more often are able to 

invest in new companies by purchasing shares when they are resold by the IPO subscribers in the 

public market in the days following the IPO. 

29. Pre-existing shareholders can also sell their shares in the IPO if their shares are 

included in and registered as part of the offering.  Shares held by such shareholders are included 

in the IPO and the shareholders are called “selling shareholders.”  The federal securities laws 

contain a number of disclosure requirements as to selling shareholders.  The registration 

statement discloses the number of shares each selling shareholder currently owns, plans to sell in 

the offering, and will retain following the offering under Principal and Selling Shareholders or a 

similarly captioned section.  Companies must also disclose any position, office or other material 

relationship each selling shareholder has had with the company within the past three years, so 

that public investors can discern the relationships the selling shareholders have had with the 

company and what proportion of their respective holdings is being sold.   

30. The trading price of a new publicly registered stock may be affected by a limited 

supply of shares in the market immediately following an IPO.  The shares being traded on the 

first day are generally only shares that were sold in or registered with the IPO.  All other 

outstanding shares, such as those held by founders, early investors and employees that have not 

been included in the IPO, may often not be sold in the public market so soon after the IPO, either 

because they are “restricted securities” under the federal securities laws that can only be resold 

without registration under certain circumstances, or because the existing shareholders have 

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entered into a “lock-up agreement” in which they agree not to sell their shares for a certain 

period of time, typically 180 days. 

31. Stocks are susceptible to dramatic price movements in the first few days of public 

trading given their stock prices are unsettled and the possibly heightened interest in new 

companies, especially where hype is created around them.  In fact, some microcap companies 

pay persons or entities to recommend or “tout” stock (“stock promoters”) in unsolicited 

electronic communications, such as emails, texts, social media posts or internet chatrooms.  

Federal securities laws require the disclosure of the source, amount, and type of compensation 

for the promotion.  Furthermore, stock promoters – and those who direct them – are prohibited 

under federal securities law from recommending the public to purchase the stock at the time they 

are selling the stock.  

32. The federal securities laws also require certain disclosures when a person or group 

of persons who “agree to act together for the purpose of acquiring, holding, voting or disposing 

of equity securities of an issuer” acquires beneficial ownership of more than five percent of a 

registered class of a company’s equity securities.  First, those persons or groups are required to 

file a Schedule 13D or 13G with the SEC.  Schedules 13D and 13G are commonly referred to as 

“beneficial ownership reports.”  The term "beneficial owner" is defined under SEC rules.  It 

includes any person who directly or indirectly has or shares voting power or investment power, 

which includes the power to sell or direct the sale of the security.  Second, those persons or 

groups – and certain transactions they have entered into with the issuer – must be identified in 

registration statements and other company SEC filings. 

B. Casey’s Background in Using Promotion of Public Companies to Profit from 
Sale of Securities  

33. In or about 2016, Casey began what became a serial process to generate securities 

trading profits by acquiring significant ownership positions in microcap companies, shepherding 

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them through the public securities offering process, and coordinating marketing and stock 

promotion campaigns.  Casey initially identified future public companies through inventions 

being developed at a local medical research center.  It was through this process that Casey met a 

professor at the research center (the “Professor”).  In approximately 2015, Casey became 

involved in Moleculin Biotech Inc. (“Moleculin”), a venture the Professor was founding with a 

biotech executive (the “Moleculin/Soliton CEO”).  In addition to investing, Casey signed a 

consulting agreement with Moleculin to work on investor relations and business operations.  

Casey introduced Moleculin to an underwriter and lawyer he thereafter continued to use in the 

ensuing scheme with other microcap companies.  Casey also worked with James, a long-time 

friend, on marketing and other efforts to take Moleculin public. 

34. Casey has used much the same pattern of conduct on subsequent microcap 

companies (with details as to each company described below).  First, Casey embedded himself in 

the company by amassing a large block of shares in the names of LLCs he controls and 

positioning himself as a “consultant” to the company on various marketing and financing 

matters, especially the going-public process.   

35. Casey aimed to have the company list on the Nasdaq, sometimes looking to 

minimally satisfy Nasdaq’s requirements for the listing of an IPO and other times looking for 

“Nasdaq shells” for reverse merger.  In a reverse merger transaction, an existing public “shell 

company,” which is usually a public reporting company with few or no operations, acquires a 

private operating company whereby the shareholders of the private operating company exchange 

their shares for a large majority of the shares of the public company. Although the public shell 

company survives the merger, the private operating company’s shareholders gain a controlling 

interest in the voting power and outstanding shares of stock of the public shell company. The 

assets and business operations of the post-merger surviving public company are primarily, if not 

solely, those of the former private operating company. 

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36. Casey recruited friends to pose as the manager of entities through which he 

purchased and sold shares.  Casey coordinated marketing and stock promotions before publicly 

selling the shares held personally or in the names of those nominee entities.  Throughout, Casey 

deliberately concealed his involvement from the investing public for a specific reason: the 

LuxeYard Litigation.   

C. Impact of the LuxeYard Litigation 

37. Casey was experienced with securities reporting requirements.  From 2004 to 

October 2010, Casey had filed at least 36 beneficial owner reports with the Commission as the 

officer, director, and 10% shareholder of three public companies.  But then beginning in 2012 

Casey was the central figure in the LuxeYard Litigation, a span of at least 38 private lawsuits in 

federal and state courts across four states stemming from Casey’s orchestration of a fraudulent 

manipulation of the stock of LuxeYard, a microcap company.   

38. As stated in a Form 8-K publicly filed with the Commission in January 2013, 

LuxeYard first “filed suit against Defendant Kevan Casey and his associates for manipulation of 

the Company’s stock price.”  Casey settled the case within days of its filing.  Nonetheless, Casey 

remained the main subject in several other lawsuits against his alleged co-conspirators, including 

Friedlander, Wheat, and a friend who is one of the nominees Casey used here (“Casey Nominee 

# 1”).   

39. For example, in 2017, a trial court conducted a bench trial and entered a judgment 

in favor of LuxeYard on its claim that Casey and others conspired in Casey’s violations of his 

fiduciary duties as LuxeYard’s undisclosed control person.  In October 2019, the appellate court 

affirmed the trial court with pages of factual findings of Casey’s misconduct, including 23 

bulleted ways Casey controlled LuxeYard and enlisted, among others, Friedlander through the 

going-public process and ensuing manipulation of the stock price amid stock promotion 

campaigns.  For example, the court noted that Casey “gave Friedlander 2.5 million shares of 

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free-trading stock in LuxeYard with instructions to sell them to fund the misleading advertising 

in support of the pump-and-dump scheme.”  The published opinion also identified Casey 

Nominee # 1 by name. 

40. Casey understood that these findings were damaging, as broker-dealers 

affirmatively closed his accounts based on their due diligence on him.  While taking a similar 

role as he did with microcap LuxeYard on the series of microcap issuers here – and using some 

of the same associates – Casey and the other Defendants purposefully hid themselves from the 

investing public by, among other things, creating nominee entities with appointed officers, 

subject to their control, to hold and dispose of their stock holdings, and falsely representing these 

nominee entities (or their officers) as the only beneficial owners of the stock.  Defendants’ 

evasion of required disclosures harmed public investors who were deprived of material 

information to assess the value of those securities and suffered aggravated pecuniary losses 

given precipitous stock price drops in all the stocks during periods of their public trading.     

D. CNS – Casey as Undisclosed Public Company Promoter 

41. In 2017, Casey began working on what would become CNS.  After working with 

Casey on Moleculin, the Professor approached Casey to help organize a business entity for 

developing a drug technology currently licensed by the medical research center.   

42. The Professor viewed himself and Casey as the “cofounders” of CNS.  Casey 

provided initial funding for the venture through convertible promissory notes by which he could 

convert the debt into shares at a rate of $0.0138 per share.  The entire note could be converted 

upon an IPO (or “Qualified Offering”).  

43. Casey worked together with the Professor to form what would become the public 

company.  Casey helped select officers, directors and scientific advisory board members, and 

introduced the Professor to CNS’s first CFO and incorporator.  After CNS was formed, but prior 

to its IPO, Casey entered into a consulting agreement with CNS via his nominee entity GSK.  

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CNS compensated Casey through GSK with a mix of cash and warrants. A warrant is a contract 

that gives the holder the right to purchase from the company a certain number of additional 

shares of common stock in the future at a certain price.   

44. Casey then worked to take CNS public per the pattern described above.  Casey 

provided comments on draft SEC filings, advised on press releases, assisted in the search for 

additional drug technologies to add to the company’s portfolio, and introduced CNS to multiple 

consultants.  Notably, Casey introduced the company to James, with whom Casey had also 

worked on taking Moleculin public.  Pursuant to a consulting agreement identical to Casey’s, 

James organized a crowdfunding campaign and advised on website design and contents, 

marketing efforts, and investor materials.  Casey also approached a stock promoter, Ahmed 

Alomari, to promote CNS around its IPO, and negotiated Alomari’s agreement with CNS.   

45. All the while, Casey amassed millions of shares in CNS.  CNS began public 

trading in November 2019 upon the effectiveness of a Form S-1 registration statement making 

no mention of Casey.  Casey has not been mentioned in any other SEC filing regarding CNS.   

46. In 2020 and 2021, Casey sold almost 2 million CNS shares on the open market.  

Ultimately, Casey sold the remainder of his shares in CNS in 2022 after a disagreement with 

CNS management about press release strategy.  Overall, Casey earned approximately $3.2 

million in profits from his work on CNS while purposefully evading the legal requirements to 

disclose his identity as a public company promoter of CNS.   

E. Soliton - Casey and James as Undisclosed Group, Selling Shareholders, and 
“Consultants” 

47. At the same time as the CNS transactions were unfolding, Casey and James 

worked even more closely together to take another microcap company, Soliton, public.  The 

Moleculin/Soliton CEO was the Chief Executive Officer of both Moleculin and Soliton.  In early 

2018, the Moleculin/Soliton CEO approached Casey and James jointly to see if they would 

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finance the still-developing company and work together to take it public.  According to the 

Moleculin/Soliton CEO, he wanted Casey and James to be a “team of shareholders” based on his 

experience working with them on Moleculin.   

48. Casey conveyed to the Moleculin/Soliton CEO that he and James wanted to be 

involved, together, in the process of preparing Soliton to make a public offering of stock.  In 

April 2018, Casey and James agreed to invest the same amount of money in Soliton by signing 

the same Note Purchase Agreement.  In return for each investing $125,000, Casey and James 

received a convertible note by which they could convert the debt into shares of common stock at 

a conversion rate of $0.175 per share upon a “Qualified Offering,” which was defined as an 

offering of up to 2,000,000 shares (amended in August 2018 to 3,000,000 shares) at a price of at 

least $5.00 per share.  The Note Purchase Agreement also gave Casey and James veto power 

over pre-IPO financings below certain thresholds.    

49. The Note Purchase Agreement also contained a “4.99% blocker” so that each of 

Casey and James could not convert the note into shares of common stock that would cause either 

of them individually to own more than 4.99% of Soliton’s registered class of stock.  Casey 

wanted the blocker to avoid the requirement to file beneficial ownership reports with the SEC, 

but the blockers did not prevent the legal requirement for Casey and James to disclose their 

aggregate holdings.   

50. Casey and James agreed amongst themselves not just to finance Soliton through 

the same Note Purchase Agreement, but also to work together to take Soliton public.  Casey and 

James sought to enter into a joint agreement with Soliton for compensation for their services.  

On July 13, 2018, Casey emailed the Moleculin/Soliton CEO (copying James) to “modify the 

[Moleculin] consulting agreement that I have for our Soliton arrangement and send it to us.”  

Casey and James then sought hundreds of thousands of warrants and a “$200K+” cash 

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component in return for their services.  By email dated August 12, 2018, Casey further 

negotiated the terms by which both he and James would be compensated for their services.   

51. Casey and James did not reach a compensation agreement with Soliton prior to 

the IPO.  Rather, Casey and James did all their pre-IPO work together to advance their common 

goal to take Soliton public and later sell their shares in the public market.  The terms of their 

Note Purchase Agreement underscored that they shared that common goal from the onset, as it 

required Soliton to use its best efforts to commence a securities offering with the Commission 

within 90 days.              

52. Casey and James took a substantial role in the going-public process.  In 

compliance with Casey and James’ Note Purchase Agreement, Soliton filed a draft registration 

statement on June 15, 2018.  Whereas Casey and James had just recently purchased a note 

convertible into shares at $0.1875 per share, the draft registration statement specified the IPO 

price would be $5.00 per share.  Casey and James together worked with Soliton executives to 

select the underwriter (Underwriter B), recruit investors, coordinate the timing and terms of pre-

IPO and IPO rounds, and formulate the marketing efforts and investor materials.  For example, 

electronic calendar invitations reflect that from June 2018 until the IPO in February 2019, 

Soliton executives invited Casey and James together to at least 27 private meetings regarding the 

going-public process, with at least 8 of those meetings being with the IPO underwriter to discuss 

such things as “IPO Strategy Discussion” and “IPO Timing and Assignments.”   

53. Ultimately, both the volume and price of the Soliton IPO exactly matched the 

minimum requirements of a “Qualified Offering” under Casey and James’ Note Purchase 

Agreement – up to 3,000,000 shares at a price of at least $5.00 per share.  In other words, the 

IPO was structured exactly to allow Casey and James to convert their notes into Soliton shares 

upon the IPO. 

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54. Casey and James also agreed to sell some of their Soliton shares together to 

support their Soliton objectives.  In 2018, Casey and James simultaneously sold the same 

number of shares to W.R., a person in the business of assisting companies with the offer and sale 

of securities, at the same discounted price to induce W.R. to assist Soliton in the going-public 

process.  Casey and James agreed that they saw value in using W.R. and agreed to sell him 

shares because it was a benefit to them both for W.R. to be involved in the offering of Soliton 

stock.   

55. After the IPO, Casey and James continued to work together on – and acquire and 

sell shares of – Soliton with the same common objective.  Casey and James jointly negotiated 

and simultaneously entered into identical Consulting Agreements with Soliton effective just a 

few days after the IPO by which they each received 87,500 shares for the same scope of “public 

markets” services.  Casey and James understood that they were receiving equal compensation 

because Soliton viewed them as contributing services of substantially similar value to the 

company’s efforts to make a public securities offering.  

i. Casey and James Agreed to Sell Stock Together to Pay for Promotions  

56. Casey and James together approached stock promoter Alomari by email to 

promote Soliton’s stock in March 2019.  Alomari has conducted stock promotional activities 

through several means, including: (1) X f/k/a Twitter (under such names as IBuyCheapStocks 

and CheapStocksUs); (2) Facebook; (3) Instagram; (4) the Investors Underground public chat 

room; (5) Alomari’s www.nasdaqstocks.com website; and (6) “Nasdaq Stock Alerts” text blasts 

to a list of phone numbers maintained by Alomari.   

57. Casey and James approached Alomari weeks after Soliton’s IPO, and at a time 

when Casey and James had shares becoming unrestricted.  By text dated March 3, 2019, James 

told Alomari that Soliton “is going to be a great deal.”  That same day, Alomari told James he 

would “make it happen for you guys.” 

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58. On March 6, 2019, Casey emailed Alomari (copying James) a detailed list of 

anticipated promotions for Alomari to “[i]ntroduce the company to all of your twitter, email and 

social media contacts,” and do “Message board posts – ongoing basis” and “Social media 

outreach.”  Casey proposed for Alomari to be paid in cash by Soliton and “[s]eparately, Adrian 

[James] and/or I [Casey] will sell” him stock at a steeply discounted price.     

59. Two days later, on March 8, 2019, Alomari began promoting Soliton on Twitter.  

Alomari coordinated the promotion with James by private chat, asking James to “[g]ive me three 

competitor tickers” and other content.  Alomari then sent James a screenshot of a tweet (with 

competitor tickers) from Alomari’s IBuyCheapStocks account: “$SOLY interesting concept.  

Sexy theme w ultra low float Looking to swing this 1-2 months personal target $7+ #stocks 

$TRIL $MBOT $DCAR $ADIL;” while Soliton stock was trading below $5 per share.  

60. In stock equities, a “float” refers to the number of shares available for public 

trading.  As noted above, microcap companies typically trade in lower volumes with fewer 

shares outstanding (in other words, a “low float”), making their prices subject to larger price 

swings based on trading activity. 

61.   Later that afternoon, Alomari messaged James suggesting responsibility for 

creating buying activity, saying: “Quick $200k in 100% PURE buying today.”  That same day, 

Alomari also texted Casey and James “already rocking it for you guys.” 

62. On March 12, 2019, Alomari tweeted again about Soliton as “Multi Billion dollar 

market Ultra low float could rip $7-10+ easy,” while Soliton was publicly trading below $5 per 

share.   

63. Casey and James’ initial proposal to Alomari on behalf of Soliton included 

compensation in the form of stock they would together “sell” him.  Alomari eventually signed a 

“Consulting Agreement” with Soliton effective April 29, 2019, by which he would receive 

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25,000 shares of restricted Soliton stock, but Casey and James immediately thereafter agreed to 

dispose some of their own unrestricted shares in exchange for these 25,000 shares.    

64. Specifically, while Alomari kept promoting Soliton stock in May 2019, Casey and 

James agreed with each other to immediately transfer the same number of unrestricted Soliton 

shares that they personally owned (11,000 shares each) to Alomari in exchange for Alomari 

agreeing to deliver his 25,000 restricted shares equally to them (12,500 shares each) six months 

later.  On May 7, 2019, Casey sent Alomari and James identical “Option Agreements” by which 

each of Casey and James would transfer the same number of shares (11,000) and later receive 

the same number of shares (12,500) from Alomari.  Casey drafted the identical “Option 

Agreements” on behalf of both himself and James.  Casey and James signed the identical 

agreements, and transferred the same number of shares to Alomari in May-June 2019. 

65. In April 2019, Casey and James made a similar sale of an identical number of 

Soliton shares to Friedlander, to compensate him for losses in Casey and James’ prior public 

company deal, Moleculin.  

66. In addition to engaging Alomari for stock promotions, Casey and James together 

formulated Soliton’s press and marketing strategy.  For example, by email dated May 9, 2019, 

Casey emailed the Moleculin/Soliton CEO and Soliton’s CFO (copying James) with a detailed 

schedule of 13 press and marketing events to take place between May 10, 2019 and June 7, 

2019.  The Soliton CEO responded: “Looks like a good plan.”  Soliton’s CFO asked “what time 

are we thinking for the [press] release on [May] 13th?”  Casey replied: “The press for next 

Monday is to be released at 9AM EST.” 

67. As of May 9, 2019, Casey’s press schedule already contained an entry for Soliton 

to be receiving FDA approval regarding a Soliton product on May 28, 2019.  In fact, on May 28, 

2019, Soliton issued a press release titled “Soliton Receives FDA 510(k) Clearance of its 

Acoustic Shockwave RAP Device.”  That same day, Casey and James both deposited Soliton 

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shares in their brokerage accounts.  Casey started selling shares that day, and James started 

selling shares the following day (the same day that Alomari posted a promotional article about 

Soliton).  Between May 28, 2019 and June 5, 2019, Casey and James sold (either personally or 

through entities they controlled) 176,500 shares and 101,600 Soliton shares for approximately 

$3.4 million and $2.3 million in sales proceeds, respectively, in the public market.  

ii.  Casey and James Evade Disclosing Their Identities in Required SEC Filings 

68. Starting in June 2019, Casey and James jointly provided two more rounds of 

financing to Soliton through the simultaneous purchase of over 1.2 million shares.  Soliton 

agreed with Casey and James to register those shares for resale through the filing of two Form S-

1 registration statements.  Casey had Casey Nominee # 1 sign the agreements with Soliton for 

the purchase and registration of the shares.   

69. For a shareholder’s shares to be made part of a registration statement for resale, 

the federal securities laws require the selling shareholder and any person with dispositive control 

over the shares to be named.  The federal securities laws also require the disclosure of any 

“material relationship which the selling security holder has had within the past three years with 

the registrant or any of its predecessors or affiliates.”  The federal securities laws also require 

“related party transactions” with 5%+ shareholders to be disclosed.  

70. In August 2019 and November 2019, Soliton filed two Forms S-1 naming Casey 

and James’ entities as “selling shareholders.”  Casey evaded disclosure in both filings by 

directing his friend and LuxeYard co-defendant, Casey Nominee # 1, to pose as the control 

person of the entity in whose name Casey purchased the shares, so that Casey Nominee # 1 – not 

Casey – would be named in the Form S-1 as the person with dispositive control over the shares. 

71. On June 28, 2019, Soliton’s counsel sent a draft of the first Form S-1 registration 

statement to James and Casey Nominee # 1.  James was aware that Casey controlled the other 

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selling shareholder, and forwarded that email only to Casey (without copying Casey Nominee # 

1).   

72. One of the documents Casey directed Casey Nominee # 1 to sign was a Form S-1 

“selling shareholder questionnaire” requested by Soliton.  Casey had Casey Nominee # 1 sign 

several Soliton-related documents, including the questionnaire and agreements, using Casey 

Nominee # 1’s middle name instead of his first name so Casey Nominee # 1’s identity would be 

more difficult to trace given he was also a defendant in the LuxeYard Litigation.   

73. The questionnaire expressly stated that it was for purposes of the company’s 

preparation of a Form S-1 for the registration of the resale of the selling shareholder’s shares, 

and was to be signed by the “undersigned beneficial owner” of the shares.  The questionnaire 

also contained as “Exhibit A” a draft of the “Selling Stockholders” section of the Form S-1, with 

a blank space where the persons or persons with “voting and dispositive power over the shares” 

would be identified.   

74. The questionnaire asked for four items to be completed, including “Full Legal 

Name of Natural Control Person (which means a natural person who directly or indirectly alone 

or with others has power to vote or dispose of the securities covered by this Questionnaire)” and 

any “material relationship with the Company (or its predecessors or affiliates) during the past 

three years.”  The Questionnaire expressly stated that “the undersigned consents to the disclosure 

of the information contained herein in its answers to Items 1 through 4 and the inclusion of such 

information in the Registration Statement” and “understands that such information will be relied 

upon by the Company in connection with the preparation and amendment of the Registration 

Statement.”   

75. Casey submitted false selling shareholder questionnaires for the two Form S-1 

registration statements filed by Soliton in August and November 2019.  Those questionnaires, 

among other things, listed only Casey Nominee # 1 as the control person with dispositive control 

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over the shares (whereas Casey was).  The questionnaires also did not disclose any relationships 

with Soliton, despite Casey’s Note Purchase Agreement, Consulting Agreement, and other 

extensive involvement in taking Soliton public and promoting its stock. 

76. The two Forms S-1 ultimately identified Casey Nominee # 1 (by his alias) – not 

Casey.  

77. James was aware of Casey’s role in the LuxeYard Litigation, in which the 

appellate court published its extensive findings on Casey in October 2019 (between the filing of 

the two Forms S-1). 

78. Like Casey, James used a nominee as the purported sole control person of his 

shares on the second Form S-1, when in fact James was that sole person with dispositive power 

over that entity’s Soliton shares.  As a result, neither Casey nor James was named in the second 

Form S-1 that went effective in November 2019.   

79. The Forms S-1 also stated that the selling shareholders (entities 100% owned and 

controlled by Casey and James) “ have not had any material relationship with [Soliton] other 

than participating in prior securities offerings,” despite Casey and James’ Note Purchase 

Agreement, Consulting Agreements, and other extensive involvement in taking Soliton public 

and promoting its stock.    In fact, the Forms S-1 described both the Note Purchase Agreement 

and Consulting Agreements, but not that they were with Casey or James. 

80. Nor did the Forms S-1 or other SEC filings disclose that Casey and James were a 

“group” owning more than 5% of the registered class of Soliton stock.  Nor did the Forms S-1 or 

other SEC filings disclose Casey and James’ Note Purchase Agreement or Consulting 

Agreements as related party transactions with 5%+ shareholders.     

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iii.  Casey and James Continue to Pay for Soliton Stock Promotions into Which 
They Sell Their Soliton Stock 

81.     Casey and James continued to sell Soliton securities as they jointly directed 

Soliton’s press and marketing efforts in the midst of their joint purchase and registration of 

Soliton shares.  On or about August 9, 2019, as the first Form S-1 for the resale of their shares 

was pending, Casey and James together urgently sought Alomari’s help to promote Soliton.  

Alomari spoke with Casey and James together, and proposed that Casey and James personally 

compensate him for future stock promotions by foregoing their identical Option Agreements – 

i.e. let Alomari keep the 25,000 shares he was to turn over equally to Casey and James (12,500 

shares each).   

82. Casey and James agreed with each other to accept Alomari’s offer to forgo their 

options (worth at least $200,000 at the current market price) as payment for future promotions of 

Soliton stock.  The day after Casey and James agreed to forgo their options, James instructed 

Soliton’s CFO (copying Casey) to send Alomari materials to “cover it to his database.”  The 

following day, Casey emailed another stock promoter the final version of a press release with 

instructions to issue it after the market open, merely informing Soliton’s CFO of the timing and 

cost of the promotion.   

83. The day after that (August 12, 2019), Alomari sent out three text blasts on 

Soliton, including: “Our alert on SOLY this morning @$8.80 hit a [sic] intraday high of $12.19 

today!  Keep your eyes on SOLY over the next couple of weeks!”  On August 14, 2019, Alomari 

sent out another text blast and posted an article on his website touting Soliton.  Starting the next 

day, James publicly sold (personally or through entities he controlled) almost 100,000 shares for 

approximately $1.2 million in sales proceeds over the remainder of August 2019.  Casey and 

James then sold (personally or through entities they controlled) over 83,000 and 193,000 shares 

for approximately $1.1 million and $2.5 million in sales proceeds, respectively, in September 

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2019, and 183,500 shares and 122,550 shares for approximately $2.2 million and $1.5 million in 

sales proceeds, respectively, in October 2019.   

84. Casey and James were both aware of Alomari’s text blasts, some of which had no 

disclosure regarding Alomari’s compensation and no link to any article or other content.  On 

August 20, 2019, Soliton received a complaint from a recipient of Alomari’s unsolicited text 

blasts.  Soliton’s CFO forwarded the complaint to Casey and James and asked them to “please 

have [Alomari] cease doing anything related to Soliton today until we get to the bottom of this.”  

Attached to the complaint were copies of text blasts with no disclosure of Alomari’s 

compensation, and other promotional materials with inaccurate disclosures of his compensation 

by not mentioning Casey and James’ compensation.  James privately chatted with Alomari about 

the text blast complaint, and thanked Alomari for contacting Soliton’s CFO about it.     

85. Casey and James continued to sell (personally or through entities they controlled), 

as Alomari continued to tout, Soliton stock throughout 2020.  Alomari frequently chatted with 

Casey and James amid his continued promotion of Soliton stock in 2020.  For example, on July 

6, 2020, Alomari sent Casey and James (in a private group chat) screenshots of an investor 

chatroom, including Alomari’s post “I’m swinging for the fences.  Buyout target…”  Alomari 

told Casey and James “Pay attention to the times plz.”  Also on July 6, 2020, Alomari sent Casey 

and James a link to a Seeking Alpha article on Soliton.  James told Alomari and Casey that the 

Seeking Alpha article did not appear to have a positive effect on the stock.  Alomari responded: 

“I’ll distribute it and get some eyeballs on it.”  Later that day, Alomari sent Casey and James a 

screenshot of a tweet “$SOLY MAJOR BOUNCE Potential and buyout target” with a link to the 

Seeking Alpha article.  Casey and James both gave Alomari “thumbs up” symbols in the chat.   

86. James (personally or through entities he controlled) sold Soliton shares in the 

public market starting that day and on each of the following 12 trading days (July 6 to 23, 2020), 

for a total of approximately 53,000 shares for approximately $438,000 in sales proceeds in the 

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public market.  Between July 7 and July 13, 2020, Casey (personally or through entities he 

controlled) sold approximately 90,000 shares of Soliton stock for approximately $709,000 in 

sales proceeds in the public market.   

87. On September 11, 2020, Alomari texted Casey and James “About to give SOLY a 

little nudge.”  An hour later Alomari texted Casey and James screenshots of multiple tweets and 

Investors Underground posts he had made (with no disclosure of compensation), including 

“Personal Target $10-12+ near term” when the stock traded under $7 per share.   

88. On October 19, 2020, Alomari sent Casey and James screenshots of Twitter, 

Instagram and Investors Underground posts promoting Soliton telling them: “We’re very close 

guys.”  The Instagram post stated (without disclosure of compensation): “Your boy 

#PennyStockAdvice always does right by you!  $9.30 and climbing.  Multi month break out.  

200 ma test if we build above we’re looking at $10-12 fast.  2.2m shares are short and FDA and 

other catalysts are coming.  Squeeze time. W[ith] approval could see $15++.”  The following 

day, Alomari texted Casey and James: “SOLY protected…Can run now.”  In the remainder of 

2020, Casey (personally or through entities he controlled) sold approximately 285,000 Soliton 

shares for approximately $2.3 million in sales proceeds in the open market. 

F. EBET – Casey, Friedlander and Wheat as Undisclosed Public Company 
Promoters, Selling Shareholders, and/or Beneficial Owners  

 
89. The next public company targeted by Casey as part of the fraudulent scheme 

involved Friedlander and Wheat.  In May 2020, Casey and Friedlander identified an online 

gaming business being run through a private Belize entity of which Friedlander’s business 

associate was a member and director (the “Belize entity member/director”).  According to 

Friedlander, Casey and Friedlander “work[ed] together” to jointly finance the private entity and 

take the company through a public securities offering.   

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90. Casey and Friedlander first engaged Casey’s longtime underwriter, Underwriter 

B, to help find a “Nasdaq shell” for a reverse merger.  On June 17, 2020, Casey created a private 

group chat among Casey, Friedlander, and a principal of Underwriter B (the “Underwriter 

Principal”).  On June 21, 2020, Casey and Friedlander told the Underwriter Principal they were 

“concerned about the 3pc reporting requirement and being classified as acting as a group 

potentially.”  Nonetheless, Casey texted the Underwriter Principal in the private group chat: “We 

[Casey and Friedlander] had a couple of questions….Website and [PowerPoint] will be done and 

sent to you on Monday” so Underwriter B could send it to shell candidates.   

91. Casey and Friedlander continued to work with Underwriter B to find a shell 

merger candidate into at least September 2020.  After several attempts at finding a shell, Casey 

and Friedlander decided to take the private Belize entity public through an IPO.  To that end, 

Casey and Friedlander guided the Belize entity member/director to form a new Nevada 

corporation (as Casey did with CNS) as the business vehicle to make their planned public 

securities offering.     

92. On or about July 23, 2020, Casey, Friedlander, and their business associate Wheat 

provided unsecured loans in the same amount to the private Belize entity.  Wheat knew the three 

of them were lending the same amount to the private Belize entity, and knew the purpose of 

Casey, Friedlander, and his loans was to pay to clean up the private Belize entity’s financial 

books and records. 

93. Registration statements must contain financial statements that are prepared by an 

independent auditor. 

94. Then, Casey, Friedlander, and Wheat – all three of whom were LuxeYard 

Litigation defendants – devised how to acquire substantial amounts of shares in the soon-to-be 

public company, but held in the name of persons other than them.  Friedlander and Wheat both 

set up new Wyoming corporations, on the same day, for the specific purpose of acquiring and 

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holding shares in the private Belize entity.  Both Friedlander and Wheat set up these nominee 

entities with nominee officers whom they controlled and with whom they had a relationship of 

trust and confidence.  Friedlander used his father and Wheat used his personal attorney who 

represented him in the LuxeYard Litigation.   

95. In or about July and August 2020, Casey, Friedlander, and Wheat each bought 

internet domains in the name of their nominee entities as a transactional front to receive 

substantial amounts of shares in advance of their planned public securities offering.  Casey and 

Friedlander agreed to acquire their shares together by purchasing internet domain names for 

$30,000-$48,000 each through a nominee entity.  Friedlander identified domain names that were 

available for sale, negotiated the purchase of the domain on behalf of Casey, and instructed 

Casey to pay for the domain.   

96. Meanwhile, on or about August 27, 2020, Wheat purchased domain names from 

the private Belize entity member/director for $18,000 in the name of Wheat’s nominee entity, 

YSW Holdings.   

97. The sole purpose of Casey, Friedlander, and Wheat’s domain purchases was to 

serve as a means to obtain shares in the soon-to-be public company while making it appear to be 

a bona fide, arms-length transaction with the private Belize entity.  These transactions were not 

arms-length.  Casey, Friedlander and Wheat extracted substantially more value from the 

company than the domains were worth.  At the time they purchased the domains, Casey, 

Friedlander, and Wheat had no intention to use those domains themselves.  Rather, even before 

acquiring the domains, they intended to assign those domains to the private Belize entity in 

return for an exorbitant number of shares compared to what they had to pay for the domains. 

98. According to Casey, he and Wheat discussed purchasing domains around the time 

Casey, Friedlander, and Wheat all purchased domains.  Casey understood that he, Friedlander, 

and Wheat would each have agreements with the private Belize entity to transfer domains.  

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Casey drafted a “Domain Purchase Agreement” by which Casey, Friedlander, and Wheat each 

would transfer the domains they had just purchased to the private Belize entity for a $700,000 

promissory note convertible into 1,400,000 shares (a conversion rate of $0.50 per share) and a 

warrant to purchase at least 635,000 additional shares at an exercise price of $0.30 per share.  

Casey and Friedlander’s agreements also had a cash payment due from the private Belize entity 

($375,000 for Friedlander, $300,000 for Casey).   

99. Within days of Wheat’s purchase of domains from the private Belize entity 

member/director, Casey, Friedlander, and Wheat entered into the Domain Purchase Agreements 

with the same effective date of September 1, 2020.  Casey, Friedlander, and Wheat were aware 

they had each entered into a similar Domain Purchase Agreement.  Each of Casey, Friedlander, 

and Wheat had his nominee sign the Domain Purchase Agreement with their nominee entity as 

the contracting party.  Those signed versions of the agreement were included as exhibits in the 

Form S-1 registration statement.      

100. The amounts Casey, Friedlander, and Wheat received under the Domain Purchase 

Agreements were exorbitant compared to what they had just paid for the domains, especially in 

light of the going rate for shares in the private Belize entity at the time.  Casey (in the name of 

GSK) had purchased shares in July 2020 from the private Belize entity at $1.50 per share.  

Moreover, on September 12, 2020, Casey texted a future EBET officer that a $2 pre-IPO round 

was being “upsized” (i.e., enlarged) “based on demand.”  That same day, Casey texted Alomari 

that the IPO would be priced at $5 per share.   

101. At the $2 pre-IPO price, the 1,400,000 convertible shares alone of each of Casey, 

Friedlander, and Wheat were worth $2,800,000 (versus domains just bought for as low as 

$18,000).  Casey intended the consideration received under the agreement (convertible note, 

warrants, and cash) to compensate all of his activities to prepare the company and take it through 

the public securities offering.     

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102. Soon after their Domain Purchase Agreements, Casey, Friedlander, and Wheat 

continued to take steps toward forming and launching the publicly traded company.  For 

example, on or about September 21, 2020, an EBET officer invited Casey and Friedlander to a 

“Weekly Update” with an agenda.  Friedlander forwarded the invitation to Wheat.  On or about 

November 10, 2020, the same EBET officer invited Casey, Friedlander, and Wheat to a “Weekly 

Board Update” that would be held on “Thursday moving forward per group request and 

recurrence.  I will send an update ahead of the call as usual.”  Two day later, the same officer 

sent to Casey, Friedlander, and Wheat an agenda for the “Weekly Board Update” that included 

“S-1 Progress.”   

103. In November 2020, EBET officers invited Casey, Friedlander, and Wheat to 

several other calls and meetings, including a “Board Member Interview” and “ESEG 

Jon/Kevan/Robert Weekly Update.”  “Weekly Catchup” invitations to Casey, Friedlander, and 

Wheat continued into 2021.    

104. On or about December 1, 2020, an EBET officer emailed Casey and Friedlander 

about “meet and greets” with prospective investors.  Casey responded to the EBET officer and 

added Wheat to the response.   

105. As the IPO approached, on February 22, 2021, an EBET officer emailed Casey, 

Friedlander, and Wheat an invitation to meet with a stock promoter with whom Casey had 

previously worked on CNS and Soliton.   

106. In or about December 2020, Casey, Friedlander, and Wheat simultaneously 

bought shares from one of the founders of EBET’s predecessor.  Friedlander and Wheat 

purchased the same number of shares at the same price.  On or about December 29, 2020, 

EBET’s CFO sent Casey and Friedlander a draft agreement for each of Casey, Friedlander, and 

Wheat’s entities to convert some of the shares under their Domain Purchase Agreements so that, 

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combined with the shares purchased from the EBET founder, each of Casey, Friedlander and 

Wheat “will have 519,277 [shares] post conversion.”   

107. Casey and Friedlander controlled the structure and timing of the IPO, which took 

place in April 2021.  As early as September 2020, Casey and Friedlander told a future EBET 

officer “We are aiming for $5 on the ipo.  Timing still the same.”  Casey and Friedlander 

decided to register their and Wheat’s 519,277 shares as part of the IPO while “locking up” the 

shares of the founders, officers, directors, and pre-IPO investors for several months.  Casey 

drafted the lockup language with Friedlander, and sent it to the CFO to incorporate in 

agreements and the Form S-1.   

i. Casey, Friedlander and Wheat Evade Legal Obligations to Disclose Their 
Identities and Material Relationships to EBET. 

108. In drafting the registration statement, EBET used a similar form “Selling 

Shareholder Notice and Questionnaire” as Soliton.  On or about February 21, 2021, EBET’s 

CFO sent Casey and Friedlander the form Selling Shareholder Questionnaire and asked: “Can 

you guys get these filled out for each of the 4 entities represented on the selling shareholders 

table?”  Those four entities were Casey’s, Friedlander’s, and Wheat’s nominee entities (Vertical 

Holdings, Dover Hill, Esports Group, and YSW Holdings). 

109. The Selling Shareholder Questionnaires for Casey, Friedlander, and Wheat’s 

entities were all submitted within a two-day period.  On March 7, 2021, Friedlander sent an 

already-completed Selling Shareholder Questionnaire to his father to sign.  That same day, 

EBET received YSW Holdings’ completed Selling Shareholder Questionnaire, which named 

only Wheat’s lawyer and disclosed no material relationship with EBET, its predecessors, or its 

affiliates despite Wheat’s purchase of the domains from EBET’s predecessor’s member and 

director (and control person of EBET’s largest shareholder) for which Wheat (via YSW 

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Holdings) was receiving, among other things, a convertible note worth 1.4 million shares in the 

company.   

110. On or about March 8, 2021, Casey replaced Casey Nominee # 1 with another 

nominee (“Casey Nominee # 2”) as the purported manager of Vertical Holdings and Dover Hill.  

However, Casey’s appointment of Casey Nominee # 2 was limited only purportedly “to handle 

all dispositive (buying and selling) and voting control for all [EBET] shares.”  That same day, 

Casey had Casey Nominee # 2 sign the Selling Shareholder Questionnaire for Vertical Holdings 

and Dover Hill (naming only Casey Nominee # 2 and disclosing no material relationship) and 

sent it to EBET.   

111. On March 9, 2021, Friedlander’s wife sent to EBET Esports Group’s Selling 

Shareholder Questionnaire, which named only his wife and disclosed no material relationships 

with EBET, its predecessors, or its affiliates. 

112. The three completed questionnaires were false and misleading in stating that the 

nominees were the only control persons with dispositive and voting control over the shares.  The 

completed questionnaires omitted the material information that Casey, Friedlander, and Wheat 

had dispositive control.  According to Casey, he used nominees to keep his name out of SEC 

filings given the LuxeYard Litigation, in which Friedlander and Wheat were also defendants.  So 

instead of a Form S-1 disclosing three LuxeYard Litigation defendants as the selling 

shareholders with agreements compensating them for efforts to take EBET public, the investing 

public was given the false impression that three shareholders had no apparent connection to each 

other and had merely sold domains to EBET at arms-length (versus as pre-determined 

passthroughs to acquire exorbitant amounts of shares).     

113. EBET’s Form S-1 registration statement, which included the three Domain 

Purchase Agreements signed by the nominees as exhibits, was false and misleading in not 

naming Casey, Friedlander, and Wheat as those with dispositive control over the shares.  The 

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Form S-1 also did not disclose that the Domain Purchase Agreements were compensation for not 

just the transfer of domains, but also personal services and efforts to take EBET public.  Nor did 

the Form S-1 disclose that Casey, Friedlander and Wheat planned to use the transactions to 

extract more profit in future public securities offerings than they paid for the domains.   

114. Nor did the registration statement disclose the principle followed in determining 

the amount of consideration under the Domain Purchase Agreements, the identity of the person 

making that determination, and the cost of the domains to Casey and Friedlander.  Nor did the 

Form S-1 disclose that Wheat had just purchased the domains from the Belize entity 

member/director for the purpose of receiving the securities. 

115. Underwriter B took direction from Casey and Friedlander several times on the 

EBET IPO, including how to allocate IPO shares with W.R., who was in the business of 

assisting companies with the offer and sale of securities and whom Casey brought to the deal.  

On March 31, 2021, the Underwriter Principal asked Casey and Friedlander in the private group 

chat: “All SEC filings are in.  Do we want to launch the EBET IPO today with a April 12 pricing 

and effectiveness, April 13 first trade on Nasdaq?” Casey responded: “Makes sense to me.”  The 

Underwriter Principal replied: “Ok.” 

116. On April 3, 2021, the Underwriter Principal asked Casey and Friedlander in the 

private chat if they “want to do a call today to go over the EBET order book.”  On April 12, 

2021, Casey asked the Underwriter Principal if he had “reserve[d] a nasdaq ipo slot for” April 

15.  The Underwriter Principal responded: “What time preferred?”  Casey replied: “My opinion 

is earlier the better.”  The Underwriter Principal confirmed later that evening: “Nasdaq has given 

EBET the 9.50 to 10.00 [a.m.] Eastern trading open window.”    

117. Casey, Friedlander, and Wheat also purchased additional shares in the IPO, and 

almost immediately started selling substantial amounts in the public market.  Casey, Friedlander, 

and Wheat subscribed to 146,376, 125,996, and 125,000 IPO shares in the names of Vertical 

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Holdings, Esports Group, and Oak Grove, respectively.  As a result of his purchase, Casey had 

acquired in excess of 5% - and, together with Friedlander more than 10% - of EBET’s registered 

class of securities.     

ii. Casey and Friedlander Paid for EBET Stock Promotions Into Which They Sold 
EBET Stock. 

118.   Casey and Friedlander engaged Alomari to promote EBET’s stock specifically at 

the time of the IPO to try to boost market demand and increase the price into which they could 

sell their shares.  Casey first told Alomari about EBET in September 2020 by private chat, with 

Alomari telling Casey “Push for me I always give best effort but I’ll go above and beyond.”  

Alomari soon entered a “Consulting Agreement” with EBET effective October 19, 2020, with an 

“initial term of six months.”  

119. Alomari’s first promotional activity on EBET was a post on an investor chatroom 

on April 1, 2021, that “EBET IPO going to be a huge one imo.”  On April 2, 2021, Friedlander 

started a Whatsapp group chat titled “Esports Intros,” and invited Alomari to join.  That same 

day, Friedlander provided Alomari with contact information for EBET personnel, moderated 

communications between Alomari and an EBET officer regarding social media accounts and 

content, and discussed the activities of another stock promoter for EBET.   

120. On April 9, 2021, Alomari texted Friedlander about EBET: “Are we all clear on 

the IPO for [April 13] or is it pushed back?  I want to time things accordingly.”  Friedlander 

responded: “Looking more like [April 15].”  On April 14, 2021, Casey sent Alomari a press 

release announcing EBET’s IPO. Alomari responded: “Let’s f__ing go.”  Casey replied: 

“Yepper.”   

121. The EBET IPO was priced at $6.00 per share.  On April 15, 2021, the first day of 

public trading, Alomari posted five times about EBET on Twitter and 8 times on Investors 

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Underground, an investor chatroom.  None of Alomari’s posts disclosed that he was being 

compensated to promote EBET’s stock.  

122. On that first day of public trading, several of Alomari’s posts compared EBET to 

another issuer (UTime Ltd., ticker UTME) with an IPO the previous week where the shares 

spiked 875% on the first day of public trading and another 133% on the second day of public 

trading.  Near the end of EBET’s first trading day, Alomari posted: “EBET approaching HOD's 

[highs of the day] eerily similar to UTME pull up a 60 min chart first 2 days.”  EBET’s stock 

similarly soared by 800% on its first two days of public trading.     

123. Back on Twitter at the end of the IPO day, the owner of Investors Underground 

tweeted: “Great call this AM $EBET @CheapStocksUs crushed the call in the room pre market 

wouldn’t have made my radar otherwise.”  On the second day of public trading, Casey, 

Friedlander, and Wheat (through entities they controlled) sold 191,667, 72,900, and 79,200 

shares for approximately $7.8 million, $3.1 million and $2.5 million in sales proceeds, 

respectively, in the open market.     

iii.   Casey Sells EBET Shares Subject to Restriction 

124. Casey also sold EBET shares in the three months following the IPO in excess of 

the amounts allowed under the federal securities laws. 

125. Generally, the federal securities laws make it unlawful for any person to offer or 

sell securities unless such offering or sale is registered with the Commission or is exempt from 

registration under Commission rules.  Commission Rule 144 creates a safe harbor from the 

registration requirement for persons seeking to resell securities that are not otherwise exempt 

from the registration requirements.  The Rule imposes certain threshold requirements, including 

a limit on the volume of shares that an “affiliate,” which is defined in part as a “person that 

directly, or indirectly through one or more intermediaries, controls…such issuer,” can sell in any 

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three-month period.  These holding periods serve to restrict stock sales and prevent holders from 

immediately dumping their stock into the public market. 

126. Casey controlled EBET from its onset through the going-public process by 

determining the organizational and capital structure (including whose shares would be registered 

or locked up), timing the IPO, and structuring Domain Purchase Agreements to obtain millions 

of dollars’ worth of securities for use in planned public securities offerings for a domain he had 

just purchased for around $35,000.   

127. EBET had 13,048,769 shares outstanding upon the IPO.  Casey (personally or 

through entities he controlled) sold 393,460 EBET shares in the public market for approximately 

$12.3 million in sales proceeds in the three-month period starting April 15, 2021. 

G. Volcon and Sidus Space – Casey as Undisclosed Beneficial Owner 

128. Casey’s next public company targeted as part of the scheme was Volcon, an 

electric bike manufacturer of which James was a co-founder.  In October 2020, Casey signed a 

“Consulting Agreement” by which he would receive a warrant to purchase 23,256 shares for 

providing “business advisory services” for an initial 6-month term.  James signed the agreement 

on behalf of Volcon.  According to James, Casey’s services were to find investors for Volcon.   

129. In or about July 2021, Casey began to solicit friends and family to invest in the 

Volcon IPO.  Casey lent hundreds of thousands of dollars to a number of these investors for 

them to invest in the Volcon IPO.  The loans were interest-free and not in writing.  Casey also 

put the investors in contact with the IPO underwriter to open brokerage accounts there.  Casey 

eventually assembled 25 investors, including himself through three LLCs, to invest $11.5 

million – over two-thirds of the offered shares – in the Volcon IPO.  Casey himself subscribed to 

over 26% of the shares in the Volcon IPO through his three LLCs.   

130. Casey also had preferred shares from pre-IPO investments which converted to 

common stock upon the IPO.  Overall, Casey owned 8.9% of Volcon’s outstanding common 

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stock upon the IPO, and continued to own at least 5% for the first two months of public trading.  

However, neither Casey’s ownership nor “consulting” relationship was ever disclosed in any 

SEC filings.   

131. Casey (personally or through entities he controlled) sold approximately 966,954 

Volcon shares in the public market for approximately $11.9 million in sales proceeds from 

October 8, 2021 to December 17, 2021. 

132. In late 2021, Casey was approached by Underwriter B to invest in its upcoming 

IPO for Sidus Space, a microcap space exploration company.  Casey purchased shares in both a 

pre-IPO round and the IPO in December 2021.   

133. At the time of the IPO, Casey owned 18.7% of Sidus Space’s registered class of 

common stock.  Casey purchased more shares on the open market starting the first day of public 

trading, owning a maximum of 37% of Sidus Space’s registered class.   

134. In January 2022, Casey approached his lawyer about his Sidus Space holdings.  In 

turn, his lawyer wrote to Sidus Space’s lawyer that “my clients are hoping to file their 

[Schedule] 13G tomorrow,” and seeking a statement from Sidus Space that his clients did not 

own over 10% of its common stock.   

135. On April 21, 2022, Casey’s lawyer sent a letter to Sidus Space and Casey saying 

he still represented “shareholders collectively representing more than 2 million [or 29% of all] 

Class A shares.”  Casey continued to own at least 10% of the registered Class A shares through 

December 2022.  However, at no time did Casey file any form or schedule with respect to his 

ownership of Sidus Space shares.   

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CLAIMS FOR RELIEF 

FIRST CLAIM FOR RELIEF 

Violation of Section 17(a) of the Securities Act 

(All Defendants) 

136. The Commission repeats and incorporates by reference the allegations in 

paragraphs 1-135 above.  

137. By reason of the foregoing, each of Casey, Friedlander, James, and Wheat, 

directly or indirectly, acting intentionally, knowingly, recklessly, or negligently, by use of the 

means or instruments of transportation or communication in interstate commerce or by the use of 

the mails, in the offer or sale of securities: (a) has employed or is employing devices, schemes, 

or artifices to defraud; (b) has obtained money or property by making untrue statements of 

material fact or omitting material facts necessary to make the statements made not misleading; 

and (c) has engaged or is engaging in transactions, practices, or courses of business which 

operated as a fraud or deceit upon the purchasers of such securities.  

138. By reason of the conduct described above, each of Casey, Friedlander, James, and 

Wheat violated, and unless enjoined will continue to violate, Section 17(a) of the Securities Act 

[15 U.S.C. § 77q(a)]. 

SECOND CLAIM FOR RELIEF 

Violations of Section 10(b) of the Exchange Act and Rule 10b-5 thereunder 

(Casey and Friedlander) 

139. The Commission repeats and incorporates by reference the allegations in 

paragraphs 1-135 above.  

140. By reason of the foregoing, each of Casey and Friedlander, directly or indirectly, 

acting intentionally, knowingly or recklessly, in connection with the purchase or sale of 

securities, by use of the means or instrumentalities of interstate commerce or the facilities of a 

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national securities exchange or the mail: (a) has employed or is employing devices, schemes, or 

artifices to defraud; (b) has made or is making untrue statements of material fact or has omitted 

to state material fact(s) necessary to make the statements made not misleading; and (c) has 

engaged or is engaging in acts, practices, or courses of business which operate as a fraud or 

deceit upon certain persons.  

141. By engaging in the conduct described above, each of Casey and Friedlander 

violated, and unless enjoined will continue to violate, Section 10(b) of the Exchange Act [15 

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

THIRD CLAIM FOR RELIEF 

Violations of Section 10(b) of the Exchange Act  

and Rules 10b-5(a) and 10b-5(c) thereunder 

(James and Wheat) 

142. The Commission repeats and incorporates by reference the allegations in 

paragraphs 1-135 above.  

143. By reason of the foregoing, each of James and Wheat, directly or indirectly, 

acting intentionally, knowingly or recklessly, in connection with the purchase or sale of 

securities, by use of the means or instrumentalities of interstate commerce or the facilities of a 

national securities exchange or the mail has employed or is employing devices, schemes, or 

artifices to defraud; and has engaged or is engaging in acts, practices, or courses of business 

which operate as a fraud or deceit upon certain persons.  

144. By engaging in the conduct described above, each of James and Wheat violated, 

and unless enjoined will continue to violate, Section 10(b) of the Exchange Act [15 U.S.C. § 

78j(b)] and Rules 10b-5(a) and 10b-5(c) thereunder [17 C.F.R. §§ 240.10b-5(a), 10b-5(c)]. 

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FOURTH CLAIM FOR RELIEF 

Violations of Section 13(d) of the Exchange Act and Rule 13d-1 Thereunder 

(Casey, Friedlander, and James) 

145. The Commission repeats and incorporates by reference the allegations in 

paragraphs 1-135 above. 

146. Pursuant to Exchange Act Section 13(d) and Rule 13d-1 thereunder, persons who 

are directly or indirectly the beneficial owners of more than 5% of the outstanding shares of a 

class of voting equity securities registered under the Exchange Act are required to file a 

Schedule 13D within ten days of the date on which their ownership exceeds five percent.  The 

Schedule 13D filing requirement applies both to individuals and to two or more persons who act 

as a group for the purpose of acquiring, holding, or disposing of securities of an issuer. 

147. Casey and James constituted a group for the purposes of Exchange Act Section 

13(d) and the Schedule 13D filing requirements with respect to Soliton. 

148. Casey and Friedlander constituted a group for the purposes of Exchange Act 

Section 13(d) and the Schedule 13D filing requirements with respect to EBET. 

149. Casey was under an obligation to file with the Commission true and accurate 

reports with respect to his ownership of Soliton, EBET, Volcon, and Sidus Space stock pursuant 

to Exchange Act Section 13(d) and Rule 13d-1 thereunder, but failed to do so. 

150. Friedlander was under an obligation to file with the Commission true and accurate 

reports with respect to his ownership of EBET stock pursuant to Exchange Act Section 13(d) 

and Rule 13d-1 thereunder, but failed to do so. 

151. James was under an obligation to file with the Commission true and accurate 

reports with respect to his ownership of Soliton stock pursuant to Exchange Act Section 13(d) 

and Rule 13d-1 thereunder, but failed to do so.  

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152. By reason of the foregoing, Casey, Friedlander, and James violated, and, unless 

enjoined and restrained will continue to violate, Section 13(d) of the Exchange Act, 15 U.S.C. § 

78m(d), and Rule 13d-1 thereunder, 17 C.F.R. § 240.13d-1. 

FIFTH CLAIM FOR RELIEF 

Violations of Section 16(a) of the Exchange Act and Rule 16d-3 Thereunder 

(Casey and Friedlander) 

153. The Commission repeats and incorporates by reference the allegations in 

paragraphs 1-135 above. 

154. Casey and Friedlander, after acquiring directly or indirectly the beneficial 

ownership of more than 10% of EBET’s class of equity securities registered pursuant to Section 

12 of the Exchange Act [15 U.S.C. § 78l], failed to file with the Commission a Form 3 providing 

an initial statement of beneficial ownership and, after effecting transactions in the securities, 

failed to file with the Commission Forms 4 and 5 providing statements of changes in beneficial 

ownership. 

155. Casey, after acquiring directly or indirectly the beneficial ownership of more than 

10% of Sidus Space’s class of equity securities registered pursuant to Section 12 of the 

Exchange Act [15 U.S.C. § 78l], failed to file with the Commission a Form 3 providing an initial 

statement of beneficial ownership and, after effecting transactions in the securities, failed to file 

with the Commission Forms 4 and 5 providing statements of changes in beneficial ownership 

156. By reason of the foregoing, Casey and Friedlander have violated, and unless 

restrained and enjoined will in the future violate, Section 16(a) and Rule 16a-3 of the Exchange 

Act, 15 U.S.C. § 78p(a) and 17 C.F.R. § 240.16a-3. 

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SIXTH CLAIM FOR RELIEF 

Violations of Sections 5(a) and 5(c) of the Securities Act 

(Casey) 

157. The Commission repeats and incorporates by reference the allegations in 

paragraphs 1-135 above. 

158. Casey, directly or indirectly, has made use of the means or instruments of 

transportation or communication in interstate commerce or of the mails to sell EBET securities, 

when no registration statement was in effect with the Commission as to such securities, and has 

made use of the means or instruments of transportation or communication in interstate 

commerce or of the mails to offer to sell such securities when no registration statement had been 

filed with the Commission as to such securities. 

159. By reason of the foregoing, Casey violated, and unless restrained and enjoined 

will continue to violate Sections 5(a) and 5(c) of the Securities Act [15 U.S.C. § 77e(a), (c)]. 

SEVENTH CLAIM FOR RELIEF 

Violations of Section 20(b) of the Exchange Act 

(Casey, Friedlander, and Wheat) 

160. The Commission repeats and incorporates by reference the allegations in 

paragraphs 1-135 above. 

161. Casey violated Section 20(b) of the Exchange Act [15 U.S.C. § 78t(b)] by 

knowingly or recklessly arranging for Casey Nominee # 1 and Casey Nominee # 2, whom Casey 

named as the purported managers of Vertical Holdings and Dover Hill, to sign false selling 

shareholder questionnaires submitted to Soliton and/or EBET. 

162. By knowingly or recklessly arranging for the signing of these documents with 

materially false and misleading information, Casey, directly or indirectly, through Casey 

Nominee # 1 and Casey Nominee # 2, engaged in acts through or by means of third parties that 

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would have been unlawful for him to do himself under Section 10(b) of the Exchange Act, 15 

U.S.C. § 78j(b), and Rule 10b-5(b) thereunder, 17 C.F.R. § 240.10b-5(b). 

163. Friedlander violated Section 20(b) of the Exchange Act [15 U.S.C. § 78t(b)] by 

knowingly or recklessly arranging for his wife, whom Friedlander named as the purported 

officer and director of Esports Group, to sign a false selling shareholder questionnaire submitted 

to EBET. 

164. By knowingly or recklessly arranging for the signing of this document with 

materially false and misleading information Friedlander, directly or indirectly, through his wife, 

engaged in acts through or by means of a third party that would have been unlawful for him to 

do himself under Section 10(b) of the Exchange Act, 15 U.S.C. § 78j(b), and Rule 10b-5(b) 

thereunder, 17 C.F.R. § 240.10b-5(b). 

165. Wheat violated Section 20(b) of the Exchange Act [15 U.S.C. § 78t(b)] by 

knowingly or recklessly arranging for his personal lawyer, whom Wheat named as the purported 

officer and director of YSW Holdings, to sign a false selling shareholder questionnaire submitted 

to EBET. 

166. By knowingly or recklessly arranging for the signing of this document with 

materially false and misleading information, Wheat, directly or indirectly, through his personal 

lawyer, engaged in acts through or by means of a third party that would have been unlawful for 

him to do himself under Section 10(b) of the Exchange Act, 15 U.S.C. § 78j(b), and Rule 10b-

5(b) thereunder, 17 C.F.R. § 240.10b-5(b). 

167. By reason of the foregoing, each of Casey, Friedlander, and Wheat violated, and, 

unless enjoined, will continue to violate, Section 20(b) of the Exchange Act [15 U.S.C. § 78t(b)]. 

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EIGHTH CLAIM FOR RELIEF 

Unjust Enrichment 

(All Relief Defendants) 

168. The Commission repeats and incorporates by reference the allegations in 

paragraphs 1-135 above. 

169. Relief Defendants each obtained proceeds as part, and in furtherance, of the 

securities law violations alleged above without a legitimate claim to those proceeds, and under 

those circumstances it is not just, equitable or conscionable for them to retain the proceeds. 

Relief Defendants were unjustly enriched. 

170. Relief Defendants should each be ordered to disgorge the proceeds they received 

as a result of the Defendants' violations of the federal securities laws. 

RELIEF REQUESTED 

WHEREFORE, the Commission requests that this Court find Defendants committed the 

violations alleged, and: 

A. Issue a permanent injunction prohibiting: 

1. Casey from violating Sections 5(a), 5(c) and 17(a) of the Securities Act [15 

U.S.C. §§ 77e(a), 77e(c), 77q(a)]  and Sections 10(b), 13(d), and 16(a) of the 

Exchange Act [15 U.S.C. §§ 78j(b), 78m(d), 78p(a)] and Rules 10b-5, 13d-1, 

and 16a-3 thereunder [17 C.F.R. §§ 240.10b-5, 240.13d-1 and 240.16a-3], and 

prohibiting Casey from violating Section 20(b) of the Exchange Act [15 

U.S.C. § 78t(b)]; 

2. Friedlander from violating Section 17(a) of the Securities Act [15 U.S.C. § 

77e(a)] and Sections 10(b), 13(d), and 16(a) of the Exchange Act [15 U.S.C. 

§§ 78j(b), 78m(d), 78p(a)] and Rules 10b-5, 13d-1, and 16a-3 thereunder [17 

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C.F.R. §§ 240.10b-5, 240.13d-1 and 240.16a-3], and prohibiting Friedlander 

from violating Section 20(b) of the Exchange Act [15 U.S.C. § 78t(b)]; 

3. James from violating Section 17(a) of the Securities Act [15 U.S.C. § 77e(a)] 

and Sections 10(b) and 13(d) of the Exchange Act [15 U.S.C. §§ 78j(b), 

78m(d)] and Rules 10b-5(a), 10b-5(c) and 13d-1 thereunder [17 C.F.R. §§ 

240.10b-5(a), 240.10b-5(c), 240.13d-1]; 

4. Wheat from violating Section 17(a) of the Securities Act [15 U.S.C. § 77e(a)]  

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

thereunder [17 C.F.R. § 240.10b-5], and prohibiting Wheat from violating 

Section 20(b) of the Exchange Act [15 U.S.C. § 78t(b)]; 

B. Issue a permanent injunction prohibiting: 

1. Casey from directly or indirectly, including, but not limited to, through any 

entity owned or controlled by Casey: (i) participating in the issuance, 

purchase, offer, or sale of any security; (ii) being the controlling shareholder 

of the issuer of any security (which term “controlling shareholder” means the 

possession, direct or indirect, of the power to direct or cause the direction of 

the management and policies of an issuer, whether through the ownership of 

voting securities, by contract, or otherwise); (iii) promoting any issuer of any 

security, causing the promotion of any issuer of any security, or deriving 

compensation from the promotion of any issuer of any security; for purposes 

of this injunction, ‘promoting’ or ‘promotion’ means, directly or indirectly, 

publishing, giving publicity to, or circulating any form of written 

communication, whether electronic or hard copy, the goal of which is to 

generate interest in any security; or (iv) soliciting any person or entity to 

purchase or sell any security, or to hold any security, as nominee; provided, 

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however, that such injunction shall not prevent Casey from purchasing or 

selling securities listed on a national securities exchange for his own personal 

account; 

2. Friedlander from directly or indirectly, including, but not limited to, through 

any entity owned or controlled by Friedlander: (i) participating in the 

issuance, purchase, offer, or sale of any security; (ii) promoting any issuer of 

any security, causing the promotion of any issuer of any security, or deriving 

compensation from the promotion of any issuer of any security; for purposes 

of this injunction, ‘promoting’ or ‘promotion’ means, directly or indirectly, 

publishing, giving publicity to, or circulating any form of written 

communication, whether electronic or hard copy, the goal of which is to 

generate interest in any security; or (iii) soliciting any person or entity to 

purchase or sell any security, or to hold any security, as nominee; provided, 

however, that such injunction shall not prevent Friedlander from purchasing 

or selling securities listed on a national securities exchange for his own 

personal account; 

3. James from directly or indirectly, including, but not limited to, through any 

entity owned or controlled by James: (i) participating in the issuance, 

purchase, offer, or sale of any security; (ii) promoting any issuer of any 

security, causing the promotion of any issuer of any security, or deriving 

compensation from the promotion of any issuer of any security; for purposes 

of this injunction, ‘promoting’ or ‘promotion’ means, directly or indirectly, 

publishing, giving publicity to, or circulating any form of written 

communication, whether electronic or hard copy, the goal of which is to 

generate interest in any security; or (iii) soliciting any person or entity to 

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purchase or sell any security, or to hold any security, as nominee; provided, 

however, that such injunction shall not prevent James from purchasing or 

selling securities listed on a national securities exchange for his own personal 

account; 

4. Wheat from directly or indirectly, including, but not limited to, through any 

entity owned or controlled by Wheat, soliciting any person or entity to 

purchase or sell any security, or to hold any security, as nominee; 

C. Issue an Order directing Defendants and Relief Defendants to disgorge all ill-

gotten gains or proceeds received as a result of the acts and/or courses of conduct complained of 

herein, with prejudgment interest thereon. 

D. Issue an Order directing Defendants to pay a civil money penalty pursuant to 

Section 20(d) of the Securities Act [15 U.S.C. § 77t(d)] and Section 21(d) of the Exchange Act 

[15 U.S.C. § 78u(d)]. 

E. Issue an Order prohibiting Defendants pursuant to Section 20(g) of the Securities 

Act [15 U.S.C. § 77t(g)] and Section 21(d)(6)(A) of the Exchange Act [15 U.S.C. § 

78u(d)(6)(A)] from participating in an offering of penny stock, including engaging in activities 

with a broker, dealer, or issuer for purposes of issuing, trading, or inducing or attempting to 

induce the purchase or sale of any penny stock. 

F. Enter a Final Judgment barring Defendants pursuant to Section 20(e) of the 

Securities Act [15 U.S.C. § 77t(e)] and Section 21(d)(2) of the Exchange Act [15 U.S.C. § 

78u(d)(2)] from acting as an officer or director of any issuer that has a class of securities 

registered pursuant to Section 12 of the Exchange Act or that is required to file reports pursuant 

to Section 15(d) of the Exchange Act. 

G. Grant such other and further relief as may be necessary and appropriate. 

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H. Further, the Commission respectfully requests that the Court retain jurisdiction 

over this action in order to implement and carry out the terms of all orders and decrees that it 

may enter, or to entertain any suitable application or motion by the Commission for additional 

relief within the jurisdiction of this Court. 

JURY DEMAND 

The Commission demands a jury in this matter for all claims so triable. 

Respectfully submitted, 

 SECURITIES AND EXCHANGE COMMISSION 

 By its attorneys, 

 
/s/David D’Addio  
David J. D’Addio, Pro Hac Vice Motion Pending 
Richard M. Harper II 
Attorney-in-Charge 
MA Bar No. 634782, Pro Hac Vice Motion Pending 
Jeffrey T. Cook 
Alexandra B. Lavin 
Jonathan T. Menitove 
U.S. Securities and Exchange Commission 
Boston Regional Office 
33 Arch Street, 24th Floor 
Boston, MA 02110 
(617) 573-8979 (Harper) 
(617) 573-4590 (Facsimile) 
[email protected] 
 

Dated: August 9, 2024 
 

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