SEC v. Adam E. Levin, No. 2:10-cr-00649-DSF, Central District of California (Sept. 27, 2023) — Complaint

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CHARLES E. CANTER (Cal. Bar No. 263197)
Email:  [email protected]
SARAH S. NILSON (Cal. Bar No. 254574)
Email:  [email protected]
YOLANDA OCHOA (Cal. Bar No. 267993)
Email:  [email protected]
Attorneys for Plaintiff
Securities and Exchange Commission
Katharine Zoladz, Co-Regional Director
Gary Y. Leung, Regional Trial Counsel
444 S. Flower Street, Suite 900
Los Angeles, California 90071
Telephone: (323) 965-3998
Facsimile: (213) 443-1904
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
SECURITIES AND EXCHANGE
COMMISSION,
Plaintiff,
vs.
ADAM E. LEVIN,
Defendant.
    Case    No.
COMPLAINT
2:23-cv-08081

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Plaintiff Securities and Exchange Commission (“SEC” or “Commission”) files
this complaint against Defendant Adam E. Levin (“Levin”) and alleges:
JURISDICTION
1. The Court has jurisdiction over this action under Sections 20(b),
20(d)(1), and 22(a) of the Securities Act of 1933 (“Securities Act”), 15 U.S.C.
§§ 77t(b), 77t(d)(1) & 77v(a), and Sections 21(d)(1), 21(d)(3)(A), 21(e), and 27(a) of
the Securities Exchange Act of 1934 (“Exchange Act”), 15 U.S.C. §§ 78u(d)(1),
78u(d)(3)(A), 78u(e) & 78aa(a).
2. Defendant has, directly or indirectly, made use of the means or
instrumentalities of interstate commerce, of the mails, or of the facilities of a national
securities exchange in connection with the transactions, acts, practices, and courses of
business alleged in this complaint.
3. Venue is proper in this district under Section 22(a) of the Securities Act,
15 U.S.C. § 77v(a) and Section 27(a) of the Exchange Act, 15 U.S.C. § 78aa(a),
because certain of the transactions, acts, practices, and courses of conduct
constituting violations of the federal securities laws occurred within this district and
because Levin resides in this district.
SUMMARY
4. This securities fraud enforcement action involves a scheme to conceal
paid promotion of a securities offering from at least April 2020 through August 2021.
5. Specifically, Levin, on behalf of his company, Hightimes Holding
Corporation (“Hightimes”), entered into a sham agreement with a Canadian entity
(“Entity 1”) to pay shares of stock and a percentage of investor funds raised in
exchange for promotional articles authored by William Mikula (“Mikula”) in which
Mikula would tout Hightimes’ securities offering under Regulation A (“Reg A”).
These articles, as Levin knew, falsely stated that they were based on independent
research and represented to would-be investors that neither the newsletter publishing
the articles nor the authors received any compensation for their recommendation. In

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fact, Levin paid Mikula—through Entity 1 to conceal Mikula’s receipt of funds—at
least $150,000 in cash and provided about $100,000 in lavish entertainment and
travel for Mikula and his associates.
6. In addition, Levin violated the registration provisions of the federal
securities laws. He continued the Hightimes securities offering after Hightimes was
no longer eligible for the Reg A exemption and no other registration exemption
applied. He also falsely represented to investors that they were purchasing Hightimes
common stock for a price of $1 per share, when in fact they were purchasing for $11
per share.
7. Through his conduct, Levin violated the antifraud provisions of
Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, 15 U.S.C. § 78j(b) and
17 C.F.R. § 240.10b-5, and the antifraud provisions of Section 17(a) of the Securities
Act, 15 U.S.C. § 77q(a). Levin also violated the registration provisions of Sections
5(a) and 5(c) of the Securities Act, 15 U.S.C. §§ 77e(a) & 77e(c).
8. The SEC seeks permanent injunctions against future violations of
Exchange Act Section 10(b) and Rule 10b-5 thereunder and Securities Act Sections
5(a) and 5(c) and 17(a), a civil penalty against Levin, and an order barring Levin
from serving as an officer or director of a public company.
THE DEFENDANT
9. Adam Levin, age 44, is a resident of Venice, California. Levin founded
Hightimes in 2017 and has served as the Executive Chairman of the Board since that
time. Levin was also chief executive officer (“CEO”) of Hightimes from 2017 to
2019.
RELATED ENTITIES AND INDIVIDUALS
10. Hightimes Holding Corporation (“Hightimes”) is a Delaware
corporation with its principal place of business in Los Angeles, California.
Hightimes was founded by Levin in 2017 for the purpose of acquiring the High
Times brand, a Cannabis related publication and platform. Hightimes received

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qualifications from the Commission to conduct a Reg A offering in March 2018.
Palm Beach Venture promoted Hightimes between at least April 2020 and at least
August 2021.
11. Jonathan William Mikula, a/k/a/ William Mikula, is a resident of
Georgia, who, from at least 2019 through late 2021, was chief analyst and author of
Palm Beach Venture, a newsletter published by Palm Beach Research Group. Mikula
has been twice enjoined by federal courts, including this Court, from violating the
federal securities laws:  SEC v. Phoenixsurf.com, et al., Case No. 2:07-cv-04765-JSL,
ECF No. 6 (C.D. Cal. Aug. 14, 2007); SEC v. Mikula, Case No. 1:08-cv-03097-BBM,
ECF No. 95 (N.D. Ga. Sept. 24, 2009). In connection with false statements he made
to the SEC in the 2007 case, Mikula pled guilty to providing false information to a
federal agency, in violation of 18 U.S.C. § 1001. United States v. Mikula, Case No.
2:10-cr-00649-DSF, ECF No. 18 (C.D. Cal. Jan. 19, 2011). The SEC filed an action
in this Court in 2022 against Mikula and others arising out of the some of the same
conduct at issue in this action. SEC v. Mikula, 2:22-cv-07096-SB-E.
12. Christian Fernandez a/k/a Christian Crockwell is a Mexican citizen
residing in Georgia. Fernandez funneled a portion of the payments to Mikula in
exchange for Mikula’s Hightimes promotion. Fernandez is a defendant in the SEC’s
action against Mikula.
13. Amit Raj Beri a/k/a Raj Beri is an Australian national residing in
Florida. Beri is a defendant in the SEC’s action against Mikula. Like Fernandez, Beri
acted as a middleman between Hightimes and Mikula with respect to the promotion.
14. Palm Beach Research Group is operated by Common Sense
Publishing, LLC, a subsidiary of Market Wise, Inc., a U.S. public company. Palm
Beach Research Group publishes Palm Beach Venture, a subscription-based
newsletter that focuses on opportunities for investors to invest in securities offered
under Reg A. Mikula was one of two attributed authors of the Palm Beach Venture
newsletter.

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THE ALLEGATIONS
A. The Hightimes Offering
15. Hightimes engaged in a securities offering between March 2018 and
December 2022.
16. Hightimes was initially qualified to conduct a Reg A offering in March
2018.
17. The offering permitted Hightimes to offer shares of common stock at a
price of $11 per share.
18. By at least June 2020, Hightimes was delinquent in filing updated
audited financial statements with the Commission as required to continue relying on
the Reg A exemption.
19. Because Hightimes failed to file the updated audited financial statements
as required, Reg A was not available to any sales made in the offering after June
2020.
20. From June 2020 through December 2022, Hightimes continued to offer
and sell approximately $13 million in Hightimes securities.
21. Neither Reg A nor any other exemption from registration was available
for the transactions that occurred between June 2020 and December 2022.
22. Levin was a necessary participant and substantial factor in Hightimes’
securities offering, including that portion of the offering conducted after June 2020.
B. The Hightimes Promotion
23. In early 2020, Levin and Mikula discussed the possible promotion of
Hightimes through Palm Beach Venture.
24. Mikula introduced Levin to Beri who, acting at Mikula’s behest, began
advising Levin on how to secure Mikula’s promotion.
25. Beri directed Levin to enter into a consulting agreement with Entity 1, a
Canadian entity controlled by Individual 1.
26. The agreement ostensibly provided that Entity 1 would perform

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“marketing services” for Hightimes.
27. An initial draft of the agreement set the compensation terms at 5% of the
monies raised through the Palm Beach promotion, half in cash and half in stock, to a
maximum of $3 million.
28. While the final agreement did not include a reference to Palm Beach, the
parties understood that the contract required Hightimes to pay Entity 1 5% of investor
funds raised from the commencement of the Palm Beach promotion to the close of
the offering.
29. Levin negotiated the terms of the agreement with Beri on Hightimes’
behalf.
30. The agreement with Entity 1 was a sham and a means of concealing
payment to Mikula for the promotion.
31. Hightimes and Levin had no expectation that Entity 1 or Individual 1
would provide services under the contact, and in fact they did not provide any
services.
32. On April 6, 2020, two days after Hightimes executed the contract with
Entity 1, Palm Beach circulated an article to its subscribers touting Hightimes.
33. The article contained an “important note” falsely claiming that Palm
Beach and its affiliates were not compensated for recommending Hightimes.
34. Mikula shared the article with Levin before it was circulated to
prospective investors, and Levin failed to raise any issue about the disclaimer.
35. Beri advised Levin that it was necessary to lavishly entertain Mikula and
his associates in exchange for the Palm Beach promotion.
36. In the interest of securing the Palm Beach promotion, and during the
pendency of the promotion, Hightimes and Levin expended approximately $100,000
in investor funds to entertain Mikula and his associates, including Fernandez.
37. These lavish entertainment expenses included meals and bottle service at
clubs, yacht rentals to host Mikula, the engagement of entertainers, and other such

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expenses.
38. Much of this entertainment took place in Miami and Las Vegas, where
Mikula enticed Levin to join him with promises of filming promotional videos for
Hightimes.
39. On at least one occasion, Fernandez, Mikula’s close associate and
business partner, explicitly told Levin that the more entertainment Hightimes
provided for Mikula, the more promotional efforts Mikula would provide.
40. A September 2020 Palm Beach promotional article on Hightimes
contained the additional disclaimer that “Palm Beach Research Group writers and
publications do not take compensation in any form for covering those securities or
commodities.” This statement was false considering the extensive and lavish
entertainment that Levin bestowed on Mikula in exchange for the promotion.
41. During the pendency of the Palm Beach promotion, Levin regularly
corresponded with the inflow of investors from the successful promotion and made
no efforts to alert them that it was a paid-for-promotion.
42. Between April 2020 and June 2020, Hightimes raised $6 million through
the Palm Beach promotion.
43. Following a meeting among Levin, Mikula, and Fernandez in late
summer 2020 in Las Vegas, Hightimes paid Entity 1 $150,000, that is, 2.5% of the $6
million raised through the Hightimes promotion as contemplated in the sham
agreement between Hightimes and Entity 1.
44. Entity 1 provided no meaningful consulting services to Hightimes to
warrant these funds.
45. Entity 1 paid Mikula his portion of the $150,000 payment in two
tranches:
(a) First, Entity 1 disbursed part of Mikula’s share directly to an
entity owned by Mikula in payments of $14,980, $5,976 and $6,054 in October 2020.
(b)  Second, Entity 1 disbursed part of Mikula’s share to Fernandez,

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who in turn funneled the money to Mikula. In October 2020, Entity 1 disbursed about
$21,790 to Fernandez, who in turn paid Mikula half that amount, about $10,985, in
cash. In January 2021, Entity 1 disbursed about $19,980 to Fernandez, who again
paid half of that amount, about $9,990, to Mikula in cash.
46. The payments were paid through the Canadian entity and other offshore
accounts to conceal from investors that payments from Hightimes would go to
Mikula.
47. Levin knew, or was reckless in not knowing, that Hightimes’ payment to
Entity 1 was to compensate Mikula for his promotional articles.
48. Levin’s conduct regarding the sham agreement and the payment to
Entity 1 was also unreasonable and therefore negligent.
C. Material Misrepresentations to Investors
49. Levin also made material misrepresentations and omissions about the
price that investors were paying for Hightimes’ common stock.
50. Hightimes initially received qualification to offer shares at $11 per share.
At Mikula’s urging, and to initially secure the promotion by Palm Beach, Hightimes
and Levin falsely stated that Hightimes had changed its share price from $11 per
share to $1 per share.
51. Palm Beach’s promotional materials, as well as Hightimes investor
website, falsely stated that investors were purchasing shares at $1.
52. In response to questions from investors, Levin falsely assured investors
that they were purchasing at $1 per share.
53. In fact, Hightimes investors purchased, and continue to hold, at $11 per
share.
54. Levin knew, or was reckless in not knowing, that his statements to
investors about the share price were false.
55. In addition, Levin’s conduct when assuring investors that they were
purchasing Hightimes stock at $1 per share was unreasonable and therefore negligent.

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FIRST CLAIM FOR RELIEF
Fraud in Connection with the Purchase or Sale of Securities
Violations of Section 10(b) of the Exchange Act and Rule 10b-5
56. The SEC realleges and incorporates by reference paragraphs 1 through
55 above.
57. Levin—with Mikula, Fernandez, and Beri—carried out a scheme to
defraud through the combination of their deceptive statements and actions concerning
the Hightimes offering. Throughout the promotional campaign, defendants concealed
the compensation paid to Mikula, through Fernandez, Beri, and others, in exchange
for Mikula’s promotion of the Hightimes offering.
58. In addition, Levin misled and deceived investors by misrepresenting the
share price of Hightimes’ common stock.
59. By engaging in the conduct described above, Levin, directly or
indirectly, in connection with the purchase or sale of securities, by the use of means
or instrumentalities of interstate commerce, or the mails, (a) employed devices,
schemes, or artifices to defraud; (b) made untrue statements of material facts or
omitted to state material facts necessary in order to make the statements made, in the
light of the circumstances under which they were made, not misleading; and (c)
engaged in acts, practices, or courses of business which operated or would operate as
a fraud or deceit upon other persons, including purchasers and sellers of securities.
60. Levin, with scienter, employed devices, schemes, or artifices to defraud;
made untrue statements of material facts or omitted to state material facts necessary
in order to make the statements made, in the light of the circumstances under which
they were made, not misleading; and engaged in acts, practices, or courses of
business which operated or would operate as a fraud or deceit upon other persons,
including purchasers and sellers of securities by the conduct described in detail
above.
61. By engaging in the conduct described above, Levin violated, and unless

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restrained and 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.
SECOND CLAIM FOR RELIEF
Fraud in the Offer or Sale of Securities
Violations of Section 17(a) of the Securities Act
62. The SEC realleges and incorporates by reference paragraphs 1 through
55 above.
63. In the offer or sale of the Hightimes securities, Levin—with Mikula,
Fernandez, and Beri—carried out a scheme to defraud, through the combination of
their deceptive statements and actions concerning the Hightimes offering. Throughout
the promotional campaign, Levin concealed the compensation paid to Mikula,
through Fernandez, Beri, and others, in exchange for Mikula’s promotion of the
Hightimes offering.
64. In addition, Levin misled and deceived investors by misrepresenting the
share price of Hightimes’ common stock.
65. By engaging in the conduct described above, Levin, directly or
indirectly, in the offer or sale of securities, by use of the means or instruments of
transportation or communication in interstate commerce or by use of the mails (a)
employed devices, schemes, or artifices to defraud; (b) obtained money or property
by means of untrue statements of a material fact or by omitting to state a material fact
necessary in order to make the statements made, in light of the circumstances under
which they were made, not misleading; and (c) engaged in transactions, practices, or
courses of business which operated or would operate as a fraud or deceit upon the
purchaser.
66. Levin, with scienter, employed devices, schemes, or artifices to defraud;
with scienter and/or negligence, obtained money or property by means of untrue
statements of a material fact or by omitting to state a material fact necessary in order
to make the statements made, in light of the circumstances under which they were

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made, not misleading; and with scienter and/or negligence, engaged in transactions,
practices, or courses of business which operated or would operate as a fraud or deceit
upon the purchaser.
67. By reason of the foregoing, Levin violated, and unless restrained and
enjoined will continue to violate, Sections 17(a) of the Securities Act, 15 U.S.C.
§ 77q(a).
THIRD CLAIM FOR RELIEF
Unregistered Offer and Sale of Securities
Violations of Sections 5(a) and 5(c) of the Securities Act
68. The SEC realleges and incorporates by reference paragraphs 1 through
55 above.
69. As set forth above, Hightimes was no longer eligible for the Reg A
exemption at least as of June 2020 when it failed to file required financial statements.
Between June 2020 and December 2022, Hightimes and Levin offered and sold
approximately $13 million in Hightimes securities to investors in interstate
commerce, without filing a registration statement with the SEC, and without
qualifying for any exemption from registration.
70. By engaging in the conduct described above, Levin, directly or
indirectly, singly and in concert with others, has made use of the means or
instruments of transportation or communication in interstate commerce, or of the
mails, to offer to sell or to sell securities, or carried or caused to be carried through
the mails or in interstate commerce, by means or instruments of transportation,
securities for the purpose of sale or for delivery after sale, when no registration
statement had been filed or was in effect as to such securities, and when no
exemption from registration was applicable.
71. By engaging in the conduct described above, Levin has violated, and
unless restrained and enjoined, are reasonably likely to continue to violate, Sections
5(a) and 5(c) of the Securities Act, 15 U.S.C. §§ 77e(a) & 77e(c).

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PRAYER FOR RELIEF
WHEREFORE, the SEC respectfully requests that the Court:
I.
Issue findings of fact and conclusions of law that Levin committed the alleged
violations.
II.
Issue judgment, in forms consistent with Rule 65(d) of the Federal Rules of
Civil Procedure, permanently enjoining Levin and his officers, agents, servants,
employees, and attorneys, and those persons in active concert or participation with
him, who receive actual notice of the judgment by personal service or otherwise, and
each of them, from violating 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.
III.
Issue judgments, in forms consistent with Rule 65(d) of the Federal Rules of
Civil Procedure, permanently enjoining Levin and his officers, agents, servants,
employees, and attorneys, and those persons in active concert or participation with
him, who receive actual notice of the judgment by personal service or otherwise, and
each of them, from violating Section 17(a) of the Securities Act, 15 U.S.C. §77q(a).
IV.
Issue judgment, in forms consistent with Rule 65(d) of the Federal Rules of
Civil Procedure, permanently enjoining Levin and his officers, agents, servants,
employees, and attorneys, and those persons in active concert or participation with
him, who receive actual notice of the judgment by personal service or otherwise, and
each of them, from violating Sections 5(a) and 5(c) of the Securities Act, 15 U.S.C.
§§ 77e(a) & 77e(c).
V.
Order Levin to pay civil penalties under Section 20(d) of the Securities Act, 15
U.S.C. § 77t(d), and Section 21(d)(3) of the Exchange Act, 15 U.S.C. § 78u(d)(3).

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VI.
Enter an order against Levin, pursuant to Section 20(e) of the Securities Act,
15 U.S.C. § 77t(e), and Sections 2l(d)(2) of the Exchange Act, 15 U.S.C. § 78u(d)(2),
prohibiting him 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, 15 U.S.C. § 78l or
that is required to file reports pursuant to Section 15(d) of the Exchange Act,
15 U.S.C. § 78o(d).
VII.
Retain jurisdiction of this action in accordance with the principles of equity and
the Federal Rules of Civil Procedure in order to implement and carry out the terms of
all orders and decrees that may be entered, or to entertain any suitable application or
motion for additional relief within the jurisdiction of this Court.
VIII.
Grant such other and further relief as this Court may determine to be just and
necessary.
Dated:  September 27, 2023
 /s/ Charles E. Canter
Charles E. Canter
Sarah S. Nilson
Yolanda Ochoa
Attorneys for Plaintiff
Securities and Exchan
ge Commission

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CHARLES E. CANTER (Cal. Bar No. 263197) 
Email:  [email protected] 
SARAH S. NILSON (Cal. Bar No. 254574) 
Email:  [email protected] 
YOLANDA OCHOA (Cal. Bar No. 267993) 
Email:  [email protected] 

Attorneys for Plaintiff 
Securities and Exchange Commission 
Katharine Zoladz, Co-Regional Director 
Gary Y. Leung, Regional Trial Counsel 
444 S. Flower Street, Suite 900 
Los Angeles, California 90071 
Telephone: (323) 965-3998 
Facsimile: (213) 443-1904 

UNITED STATES DISTRICT COURT 

CENTRAL DISTRICT OF CALIFORNIA 

SECURITIES AND EXCHANGE 
COMMISSION, 

Plaintiff, 

vs. 

ADAM E. LEVIN, 

Defendant. 

 Case No. 

COMPLAINT 

2:23-cv-08081

Case 2:23-cv-08081   Document 1   Filed 09/27/23   Page 1 of 13   Page ID #:1



 

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Plaintiff Securities and Exchange Commission (“SEC” or “Commission”) files 

this complaint against Defendant Adam E. Levin (“Levin”) and alleges: 

JURISDICTION 

1. The Court has jurisdiction over this action under Sections 20(b), 

20(d)(1), and 22(a) of the Securities Act of 1933 (“Securities Act”), 15 U.S.C. 

§§ 77t(b), 77t(d)(1) & 77v(a), and Sections 21(d)(1), 21(d)(3)(A), 21(e), and 27(a) of 

the Securities Exchange Act of 1934 (“Exchange Act”), 15 U.S.C. §§ 78u(d)(1), 

78u(d)(3)(A), 78u(e) & 78aa(a). 

2. Defendant has, directly or indirectly, made use of the means or 

instrumentalities of interstate commerce, of the mails, or of the facilities of a national 

securities exchange in connection with the transactions, acts, practices, and courses of 

business alleged in this complaint.  

3. Venue is proper in this district under Section 22(a) of the Securities Act, 

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

because certain of the transactions, acts, practices, and courses of conduct 

constituting violations of the federal securities laws occurred within this district and 

because Levin resides in this district. 

SUMMARY 

4. This securities fraud enforcement action involves a scheme to conceal 

paid promotion of a securities offering from at least April 2020 through August 2021. 

5. Specifically, Levin, on behalf of his company, Hightimes Holding 

Corporation (“Hightimes”), entered into a sham agreement with a Canadian entity 

(“Entity 1”) to pay shares of stock and a percentage of investor funds raised in 

exchange for promotional articles authored by William Mikula (“Mikula”) in which 

Mikula would tout Hightimes’ securities offering under Regulation A (“Reg A”). 

These articles, as Levin knew, falsely stated that they were based on independent 

research and represented to would-be investors that neither the newsletter publishing 

the articles nor the authors received any compensation for their recommendation. In 

Case 2:23-cv-08081   Document 1   Filed 09/27/23   Page 2 of 13   Page ID #:2



 

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fact, Levin paid Mikula—through Entity 1 to conceal Mikula’s receipt of funds—at 

least $150,000 in cash and provided about $100,000 in lavish entertainment and 

travel for Mikula and his associates. 

6. In addition, Levin violated the registration provisions of the federal 

securities laws. He continued the Hightimes securities offering after Hightimes was 

no longer eligible for the Reg A exemption and no other registration exemption 

applied. He also falsely represented to investors that they were purchasing Hightimes 

common stock for a price of $1 per share, when in fact they were purchasing for $11 

per share. 

7. Through his conduct, Levin violated the antifraud provisions of 

Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, 15 U.S.C. § 78j(b) and 

17 C.F.R. § 240.10b-5, and the antifraud provisions of Section 17(a) of the Securities 

Act, 15 U.S.C. § 77q(a). Levin also violated the registration provisions of Sections 

5(a) and 5(c) of the Securities Act, 15 U.S.C. §§ 77e(a) & 77e(c).   

8. The SEC seeks permanent injunctions against future violations of 

Exchange Act Section 10(b) and Rule 10b-5 thereunder and Securities Act Sections 

5(a) and 5(c) and 17(a), a civil penalty against Levin, and an order barring Levin 

from serving as an officer or director of a public company.   

THE DEFENDANT 

9. Adam Levin, age 44, is a resident of Venice, California. Levin founded 

Hightimes in 2017 and has served as the Executive Chairman of the Board since that 

time. Levin was also chief executive officer (“CEO”) of Hightimes from 2017 to 

2019.  

RELATED ENTITIES AND INDIVIDUALS 

10. Hightimes Holding Corporation (“Hightimes”) is a Delaware 

corporation with its principal place of business in Los Angeles, California.  

Hightimes was founded by Levin in 2017 for the purpose of acquiring the High 

Times brand, a Cannabis related publication and platform. Hightimes received 

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qualifications from the Commission to conduct a Reg A offering in March 2018. 

Palm Beach Venture promoted Hightimes between at least April 2020 and at least 

August 2021. 

11. Jonathan William Mikula, a/k/a/ William Mikula, is a resident of 

Georgia, who, from at least 2019 through late 2021, was chief analyst and author of 

Palm Beach Venture, a newsletter published by Palm Beach Research Group. Mikula 

has been twice enjoined by federal courts, including this Court, from violating the 

federal securities laws:  SEC v. Phoenixsurf.com, et al., Case No. 2:07-cv-04765-JSL, 

ECF No. 6 (C.D. Cal. Aug. 14, 2007); SEC v. Mikula, Case No. 1:08-cv-03097-BBM, 

ECF No. 95 (N.D. Ga. Sept. 24, 2009). In connection with false statements he made 

to the SEC in the 2007 case, Mikula pled guilty to providing false information to a 

federal agency, in violation of 18 U.S.C. § 1001. United States v. Mikula, Case No. 

2:10-cr-00649-DSF, ECF No. 18 (C.D. Cal. Jan. 19, 2011). The SEC filed an action 

in this Court in 2022 against Mikula and others arising out of the some of the same 

conduct at issue in this action. SEC v. Mikula, 2:22-cv-07096-SB-E. 

12. Christian Fernandez a/k/a Christian Crockwell is a Mexican citizen 

residing in Georgia. Fernandez funneled a portion of the payments to Mikula in 

exchange for Mikula’s Hightimes promotion. Fernandez is a defendant in the SEC’s 

action against Mikula. 

13. Amit Raj Beri a/k/a Raj Beri is an Australian national residing in 

Florida. Beri is a defendant in the SEC’s action against Mikula. Like Fernandez, Beri 

acted as a middleman between Hightimes and Mikula with respect to the promotion.   

14. Palm Beach Research Group is operated by Common Sense 

Publishing, LLC, a subsidiary of Market Wise, Inc., a U.S. public company. Palm 

Beach Research Group publishes Palm Beach Venture, a subscription-based 

newsletter that focuses on opportunities for investors to invest in securities offered 

under Reg A. Mikula was one of two attributed authors of the Palm Beach Venture 

newsletter. 

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THE ALLEGATIONS 

A. The Hightimes Offering 

15. Hightimes engaged in a securities offering between March 2018 and 

December 2022. 

16. Hightimes was initially qualified to conduct a Reg A offering in March 

2018. 

17. The offering permitted Hightimes to offer shares of common stock at a 

price of $11 per share. 

18. By at least June 2020, Hightimes was delinquent in filing updated 

audited financial statements with the Commission as required to continue relying on 

the Reg A exemption. 

19. Because Hightimes failed to file the updated audited financial statements 

as required, Reg A was not available to any sales made in the offering after June 

2020. 

20. From June 2020 through December 2022, Hightimes continued to offer 

and sell approximately $13 million in Hightimes securities. 

21. Neither Reg A nor any other exemption from registration was available 

for the transactions that occurred between June 2020 and December 2022. 

22. Levin was a necessary participant and substantial factor in Hightimes’ 

securities offering, including that portion of the offering conducted after June 2020. 

B. The Hightimes Promotion 

23. In early 2020, Levin and Mikula discussed the possible promotion of 

Hightimes through Palm Beach Venture.  

24. Mikula introduced Levin to Beri who, acting at Mikula’s behest, began 

advising Levin on how to secure Mikula’s promotion. 

25. Beri directed Levin to enter into a consulting agreement with Entity 1, a 

Canadian entity controlled by Individual 1. 

26. The agreement ostensibly provided that Entity 1 would perform 

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“marketing services” for Hightimes. 

27. An initial draft of the agreement set the compensation terms at 5% of the 

monies raised through the Palm Beach promotion, half in cash and half in stock, to a 

maximum of $3 million. 

28. While the final agreement did not include a reference to Palm Beach, the 

parties understood that the contract required Hightimes to pay Entity 1 5% of investor 

funds raised from the commencement of the Palm Beach promotion to the close of 

the offering. 

29. Levin negotiated the terms of the agreement with Beri on Hightimes’ 

behalf. 

30. The agreement with Entity 1 was a sham and a means of concealing 

payment to Mikula for the promotion. 

31. Hightimes and Levin had no expectation that Entity 1 or Individual 1 

would provide services under the contact, and in fact they did not provide any 

services. 

32. On April 6, 2020, two days after Hightimes executed the contract with 

Entity 1, Palm Beach circulated an article to its subscribers touting Hightimes. 

33. The article contained an “important note” falsely claiming that Palm 

Beach and its affiliates were not compensated for recommending Hightimes. 

34. Mikula shared the article with Levin before it was circulated to 

prospective investors, and Levin failed to raise any issue about the disclaimer. 

35. Beri advised Levin that it was necessary to lavishly entertain Mikula and 

his associates in exchange for the Palm Beach promotion. 

36. In the interest of securing the Palm Beach promotion, and during the 

pendency of the promotion, Hightimes and Levin expended approximately $100,000 

in investor funds to entertain Mikula and his associates, including Fernandez. 

37. These lavish entertainment expenses included meals and bottle service at 

clubs, yacht rentals to host Mikula, the engagement of entertainers, and other such 

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expenses. 

38. Much of this entertainment took place in Miami and Las Vegas, where 

Mikula enticed Levin to join him with promises of filming promotional videos for 

Hightimes. 

39. On at least one occasion, Fernandez, Mikula’s close associate and 

business partner, explicitly told Levin that the more entertainment Hightimes 

provided for Mikula, the more promotional efforts Mikula would provide. 

40. A September 2020 Palm Beach promotional article on Hightimes 

contained the additional disclaimer that “Palm Beach Research Group writers and 

publications do not take compensation in any form for covering those securities or 

commodities.” This statement was false considering the extensive and lavish 

entertainment that Levin bestowed on Mikula in exchange for the promotion.   

41. During the pendency of the Palm Beach promotion, Levin regularly 

corresponded with the inflow of investors from the successful promotion and made 

no efforts to alert them that it was a paid-for-promotion. 

42. Between April 2020 and June 2020, Hightimes raised $6 million through 

the Palm Beach promotion. 

43. Following a meeting among Levin, Mikula, and Fernandez in late 

summer 2020 in Las Vegas, Hightimes paid Entity 1 $150,000, that is, 2.5% of the $6 

million raised through the Hightimes promotion as contemplated in the sham 

agreement between Hightimes and Entity 1. 

44. Entity 1 provided no meaningful consulting services to Hightimes to 

warrant these funds. 

45. Entity 1 paid Mikula his portion of the $150,000 payment in two 

tranches: 

(a) First, Entity 1 disbursed part of Mikula’s share directly to an 

entity owned by Mikula in payments of $14,980, $5,976 and $6,054 in October 2020. 

(b)  Second, Entity 1 disbursed part of Mikula’s share to Fernandez, 

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who in turn funneled the money to Mikula. In October 2020, Entity 1 disbursed about 

$21,790 to Fernandez, who in turn paid Mikula half that amount, about $10,985, in 

cash. In January 2021, Entity 1 disbursed about $19,980 to Fernandez, who again 

paid half of that amount, about $9,990, to Mikula in cash. 

46. The payments were paid through the Canadian entity and other offshore 

accounts to conceal from investors that payments from Hightimes would go to 

Mikula. 

47. Levin knew, or was reckless in not knowing, that Hightimes’ payment to 

Entity 1 was to compensate Mikula for his promotional articles. 

48. Levin’s conduct regarding the sham agreement and the payment to 

Entity 1 was also unreasonable and therefore negligent.  

C. Material Misrepresentations to Investors 

49. Levin also made material misrepresentations and omissions about the 

price that investors were paying for Hightimes’ common stock. 

50. Hightimes initially received qualification to offer shares at $11 per share.  

At Mikula’s urging, and to initially secure the promotion by Palm Beach, Hightimes 

and Levin falsely stated that Hightimes had changed its share price from $11 per 

share to $1 per share. 

51. Palm Beach’s promotional materials, as well as Hightimes investor 

website, falsely stated that investors were purchasing shares at $1. 

52. In response to questions from investors, Levin falsely assured investors 

that they were purchasing at $1 per share. 

53. In fact, Hightimes investors purchased, and continue to hold, at $11 per 

share. 

54. Levin knew, or was reckless in not knowing, that his statements to 

investors about the share price were false. 

55. In addition, Levin’s conduct when assuring investors that they were 

purchasing Hightimes stock at $1 per share was unreasonable and therefore negligent. 

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FIRST CLAIM FOR RELIEF 

Fraud in Connection with the Purchase or Sale of Securities 

Violations of Section 10(b) of the Exchange Act and Rule 10b-5 

56. The SEC realleges and incorporates by reference paragraphs 1 through 

55 above. 

57. Levin—with Mikula, Fernandez, and Beri—carried out a scheme to 

defraud through the combination of their deceptive statements and actions concerning 

the Hightimes offering. Throughout the promotional campaign, defendants concealed 

the compensation paid to Mikula, through Fernandez, Beri, and others, in exchange 

for Mikula’s promotion of the Hightimes offering. 

58. In addition, Levin misled and deceived investors by misrepresenting the 

share price of Hightimes’ common stock. 

59. By engaging in the conduct described above, Levin, directly or 

indirectly, in connection with the purchase or sale of securities, by the use of means 

or instrumentalities of interstate commerce, or the mails, (a) employed devices, 

schemes, or artifices to defraud; (b) made untrue statements of material facts or 

omitted to state material facts necessary in order to make the statements made, in the 

light of the circumstances under which they were made, not misleading; and (c) 

engaged in acts, practices, or courses of business which operated or would operate as 

a fraud or deceit upon other persons, including purchasers and sellers of securities. 

60. Levin, with scienter, employed devices, schemes, or artifices to defraud; 

made untrue statements of material facts or omitted to state material facts necessary 

in order to make the statements made, in the light of the circumstances under which 

they were made, not misleading; and engaged in acts, practices, or courses of 

business which operated or would operate as a fraud or deceit upon other persons, 

including purchasers and sellers of securities by the conduct described in detail 

above. 

61. By engaging in the conduct described above, Levin violated, and unless 

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restrained and 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. 

SECOND CLAIM FOR RELIEF 

Fraud in the Offer or Sale of Securities 

Violations of Section 17(a) of the Securities Act 

62. The SEC realleges and incorporates by reference paragraphs 1 through 

55 above. 

63. In the offer or sale of the Hightimes securities, Levin—with Mikula, 

Fernandez, and Beri—carried out a scheme to defraud, through the combination of 

their deceptive statements and actions concerning the Hightimes offering. Throughout 

the promotional campaign, Levin concealed the compensation paid to Mikula, 

through Fernandez, Beri, and others, in exchange for Mikula’s promotion of the 

Hightimes offering. 

64. In addition, Levin misled and deceived investors by misrepresenting the 

share price of Hightimes’ common stock. 

65. By engaging in the conduct described above, Levin, directly or 

indirectly, in the offer or sale of securities, by use of the means or instruments of 

transportation or communication in interstate commerce or by use of the mails (a) 

employed devices, schemes, or artifices to defraud; (b) obtained money or property 

by means of untrue statements of a material fact or by omitting to state a material fact 

necessary in order to make the statements made, in light of the circumstances under 

which they were made, not misleading; and (c) engaged in transactions, practices, or 

courses of business which operated or would operate as a fraud or deceit upon the 

purchaser. 

66. Levin, with scienter, employed devices, schemes, or artifices to defraud; 

with scienter and/or negligence, obtained money or property by means of untrue 

statements of a material fact or by omitting to state a material fact necessary in order 

to make the statements made, in light of the circumstances under which they were 

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made, not misleading; and with scienter and/or negligence, engaged in transactions, 

practices, or courses of business which operated or would operate as a fraud or deceit 

upon the purchaser. 

67. By reason of the foregoing, Levin violated, and unless restrained and 

enjoined will continue to violate, Sections 17(a) of the Securities Act, 15 U.S.C. 

§ 77q(a). 

THIRD CLAIM FOR RELIEF 

Unregistered Offer and Sale of Securities 

Violations of Sections 5(a) and 5(c) of the Securities Act 

68. The SEC realleges and incorporates by reference paragraphs 1 through 

55 above. 

69. As set forth above, Hightimes was no longer eligible for the Reg A 

exemption at least as of June 2020 when it failed to file required financial statements. 

Between June 2020 and December 2022, Hightimes and Levin offered and sold 

approximately $13 million in Hightimes securities to investors in interstate 

commerce, without filing a registration statement with the SEC, and without 

qualifying for any exemption from registration. 

70. By engaging in the conduct described above, Levin, directly or 

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

instruments of transportation or communication in interstate commerce, or of the 

mails, to offer to sell or to sell securities, or carried or caused to be carried through 

the mails or in interstate commerce, by means or instruments of transportation, 

securities for the purpose of sale or for delivery after sale, when no registration 

statement had been filed or was in effect as to such securities, and when no 

exemption from registration was applicable. 

71. By engaging in the conduct described above, Levin has violated, and 

unless restrained and enjoined, are reasonably likely to continue to violate, Sections 

5(a) and 5(c) of the Securities Act, 15 U.S.C. §§ 77e(a) & 77e(c). 

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PRAYER FOR RELIEF 

WHEREFORE, the SEC respectfully requests that the Court: 

I. 

Issue findings of fact and conclusions of law that Levin committed the alleged 

violations. 

II. 

Issue judgment, in forms consistent with Rule 65(d) of the Federal Rules of 

Civil Procedure, permanently enjoining Levin and his officers, agents, servants, 

employees, and attorneys, and those persons in active concert or participation with 

him, who receive actual notice of the judgment by personal service or otherwise, and 

each of them, from violating 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. 

III. 

Issue judgments, in forms consistent with Rule 65(d) of the Federal Rules of 

Civil Procedure, permanently enjoining Levin and his officers, agents, servants, 

employees, and attorneys, and those persons in active concert or participation with 

him, who receive actual notice of the judgment by personal service or otherwise, and 

each of them, from violating Section 17(a) of the Securities Act, 15 U.S.C. §77q(a). 

IV. 

Issue judgment, in forms consistent with Rule 65(d) of the Federal Rules of 

Civil Procedure, permanently enjoining Levin and his officers, agents, servants, 

employees, and attorneys, and those persons in active concert or participation with 

him, who receive actual notice of the judgment by personal service or otherwise, and 

each of them, from violating Sections 5(a) and 5(c) of the Securities Act, 15 U.S.C. 

§§ 77e(a) & 77e(c). 

V. 

Order Levin to pay civil penalties under Section 20(d) of the Securities Act, 15 

U.S.C. § 77t(d), and Section 21(d)(3) of the Exchange Act, 15 U.S.C. § 78u(d)(3). 

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VI. 

Enter an order against Levin, pursuant to Section 20(e) of the Securities Act, 

15 U.S.C. § 77t(e), and Sections 2l(d)(2) of the Exchange Act, 15 U.S.C. § 78u(d)(2), 

prohibiting him 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, 15 U.S.C. § 78l or 

that is required to file reports pursuant to Section 15(d) of the Exchange Act, 

15 U.S.C. § 78o(d). 

VII. 

Retain jurisdiction of this action in accordance with the principles of equity and 

the Federal Rules of Civil Procedure in order to implement and carry out the terms of 

all orders and decrees that may be entered, or to entertain any suitable application or 

motion for additional relief within the jurisdiction of this Court. 

VIII. 

Grant such other and further relief as this Court may determine to be just and 

necessary. 

Dated:  September 27, 2023  

 /s/ Charles E. Canter  
Charles E. Canter 
Sarah S. Nilson 
Yolanda Ochoa 
Attorneys for Plaintiff 
Securities and Exchange Commission 

 

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