SEC v. DOLPHIN ASSOCIATES III, LLC; and DONALD T. NETTER, No. 3:24-cv-02022, District of Connecticut (Dec. 23, 2024) — Complaint

UNITED STATES DISTRICT COURT
DISTRICT OF CONNECTICUT

SECURITIES AND EXCHANGE COMMISSION,

Plaintiff,

v.

DOLPHIN ASSOCIATES III, LLC and
DONALD T. NETTER,

Defendants.

CIVIL ACTION NO.

COMPLAINT
Plaintiff United States Securities and Exchange Commission (“Commission”) alleges the
following against Defendants Dolphin Associates III, LLC (“Dolphin”) and Donald T. Netter
(“Netter”):
SUMMARY OF THE ACTION
1. From 2016 to the present, Defendants Dolphin, an investment adviser, and Netter,
its principal, defrauded their private fund client, Dolphin Limited Partnership III, L.P. (“Fund”)
and its investors, and breached their fiduciary duties to the Fund, by improperly withholding the
investors’ funds, failing to provide required financial statements, and overcharging them.
2. Through their management of the Fund, Defendants employed a fraudulent
scheme and engaged in a course of business that operated as a fraud or deceit on their client and
its investors in these ways:
3. Failing to Honor Investor Redemption Requests and Misrepresenting the
Reasons Why:  First, Defendants engaged in a fraudulent scheme and engaged in a course of
business that operated as a fraud or deceit on their clients by improperly suspending investor

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withdrawals and failing to honor valid investor redemption requests.  Throughout this scheme,
Defendants made false and misleading statements about the suspension of withdrawals and failed
to disclose conflicts of interest, or potential conflicts of interest, associated with their decision to
suspend withdrawals.  By engaging in this scheme and course of business, Defendants have
violated and continue to violate Sections 206(1), (2), and (4) of the Investment Advisers Act of
1940 (“Advisers Act”) and Rule 206(4)-8 thereunder.
4. Failing to Obtain or Provide Audited and Unaudited Financial Statements:
Second, Defendants engaged in a transaction, practice, or course of business that operated as a
fraud or deceit on the Fund by failing to obtain and deliver required annual audits and quarterly
financial reports to investors.  By doing so, Defendants have violated and continue to violate
Section 206(2) of the Advisers Act.
5. Overcharging Management Fees:  Third, Defendants engaged in a transaction,
practice, or course of business that operated as a fraud or deceit on the Fund by failing to
properly calculate management fees, resulting in overcharging the Fund by about $41,000.  By
doing so, Defendants have violated and continue to violate Sections 206(1) and 206(2) of the
Advisers Act.
6. Based on these violations, the Commission seeks:
a. Entry of permanent injunctions enjoining Defendants from violating Sections 206
(1), (2), and (4) of the Advisers Act and Rule 206(4)-8 thereunder;
b. Appropriate civil monetary penalties pursuant to Section 209(e) of the Advisers
Act [15 U.S.C. § 80b-9(e)];
c. Disgorgement of Defendants’ ill-gotten gains, pursuant to Sections 21(d)(5) and
21(d)(7) of the Securities Exchange Act of 1934, plus prejudgment interest;

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d. Entry of an Order requiring Defendants to (i) within 60 days of the final
judgment, process all investor withdrawals requests received by Dolphin since
2016 and issue withdrawals to such investors, subject to the audit holdback
provisions of the Fund’s Limited Partnership Agreement; and (ii) within 120 days
of the final judgment, certify compliance with the above final judgment;
e. Entry of a permanent injunction restraining and enjoining Netter from directly or
indirectly, acting as or being associated with any investment adviser; and,
f. award any other relief that the Court deems just and proper.
DEFENDANTS
7. Dolphin Associates III, LLC, is a Delaware limited liability company based in
Greenwich, Connecticut.  Dolphin has never been registered with the Commission.  Dolphin
filed an initial Form ADV as an exempt reporting adviser (“ERA”) on June 28, 2012, and
currently maintains status as an ERA.
8. Dolphin serves as the investment adviser and general partner to a privately offered
investment fund, Dolphin Limited Partnership III, L.P.  Dolphin is also an investor in the Fund.
9. Donald T. Netter, age 63, is a resident of Greenwich, Connecticut, and is the
founder and Senior Partner of Dolphin.  He is also an investor in the Fund.  Mr. Netter has never
held licenses relevant to the securities or accounting industries.  Netter is Dolphin’s only
employee.
10. Netter and Dolphin are engaged in the business of advising others as to the value
of securities or as to the advisability of investing in, purchasing, or selling securities.  They
receive compensation for these services.

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JURISDICTION AND VENUE
11. The Court has jurisdiction over this action pursuant to Sections 209(d) and 214 of
the Advisers Act, 15 U.S.C. §§ 80b-9(d) and 80b-14.
12. The Commission seeks permanent injunctions and disgorgement pursuant to
Section 209(d) of the Advisers Act, 15 U.S.C. § 80b-9(d).  The Commission seeks the imposition
of civil penalties pursuant to Section 209(e) of the Advisers Act, 15 U.S.C. § 80b-9(e).
13. The Court has personal jurisdiction over Defendants and venue is proper in this
District because Defendants reside and transact business in this District, and many acts and
omissions constituting the alleged violations occurred, in whole or in part, in this District.
14. Defendants directly or indirectly used the mails or the means or instruments of
transportation or communication in interstate commerce in connection with their business as
investment advisers and the conduct described in this Complaint.
15. Unless enjoined, Defendants will continue to engage in the securities law
violations alleged here, or in similar conduct that would violate the federal securities laws.
DEFENDANTS’ ONGOING FRAUDULENT COURSE OF CONDUCT
16. Defendants are engaged in an ongoing course of conduct that includes multiple
breaches of their fiduciary duties to their client (the Fund) and their responsibilities to investors
in that Fund, as well as misleading misrepresentations and fraudulent omissions.
17. This course of conduct includes failing to honor redemption requests by investors
and return invested capital to those investors and misrepresenting the reasons for those failures;
improperly calculating management fees and overcharging the Fund for management services;
and failing to obtain required audits and quarterly financial statements and to distribute them to
investors.

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Failure to Honor Redemption Requests and Investor Withdrawals
18. Defendants improperly suspended investor withdrawals from the Fund and
refused to honor redemption requests by investors, keeping investors invested in the Fund well
after they were entitled to the return of their invested money.
19. Section 4.7 of the Fund’s Limited Partnership Agreement (“LPA”), which was
distributed to all investors by Defendants, permitted Defendants to create “Designated
Investments.”  Designated Investments “are not publicly traded or otherwise have limited
liquidity or which the General Partner [  ] believes in good faith are likely to become private or
have limited liquidity....”
20. In 2015, Defendants classified two Fund holdings (QUMU Corporation
(“QUMU”) and Point Blank Solutions, Inc. (“PBSOQ”)) as “Designated Investments” under
Section 4.7 of the LPA.  Doing so segregated those investments from the Fund’s main portfolio
and placed them in a “side pocket,” excluding them from investor withdrawals for up to four
years.  Defendants stated they were making this classification because the investments had
limited liquidity and trading restrictions.
21.
For QUMU, the trading restrictions resulted from the fact that Netter had been
appointed to the company’s board of directors.

22. As for PBSOQ, the stock ceased to be publicly traded, and the Fund’s interest in it
became bound up in an illiquid trust.

23. Under Section 4.7 of the LPA, Dolphin could side pocket those two investments and
exclude them from investor withdrawals for up to four years, until 2019.

24. Three Fund investors made several redemption requests starting in August 2016
and continuing through December 2021.  Defendants have continually failed to honor these
requests or to take any necessary steps to allow them to be honored.

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25. Towards the end of 2016, Defendants improperly suspended all investor
withdrawals from the Fund.  In a letter to Fund investors dated November 30, 2016, Dolphin and
Netter stated that the reason for the suspension was “the concentration of several core positions”
including QUMU, “and also based upon the concentrated holdings of the Partners.”  The letter
claimed that the suspension had been ordered under Section 6.6(c) of the LPA.
26. Section 6.6(c) of the LPA gives Dolphin authority to suspend withdrawals
altogether under specific circumstances, including, inter alia, “a state of emergency or other
unusual or extraordinary circumstances” that makes it difficult to dispose of a substantial part of,
or fairly value, the Fund’s assets, or that “might seriously prejudice the Partners.”
27. Later communications with Fund investors make clear that, in fact, the suspension
was due to the Fund’s positions in QUMU and PBSOQ, the two securities that Defendants had
already side-pocketed.  In the Fund’s audited financial statements for 2017 and 2018, Dolphin
stated that the suspension of withdrawals would last until QUMU and PBSOQ were
“appropriately resolved and reallocated back to the Partnership.”
28. The status of QUMU and PSBOQ, which had already been side-pocketed, would
not have prevented the Fund from selling other portfolio assets to at least partially satisfy the
redemption requests from the Fund’s investors.
29. And, despite their representations, neither Dolphin nor Netter took any steps to
resolve and reallocate back to the Partnership the investments in QUMU and PBSOQ.
30. Between 2016 and 2019, after the suspension of withdrawals was instituted,
Netter told at least one Fund investor that Dolphin was winding down the Fund, refraining from
making new investments, and selling positions to satisfy redemption requests.  None of these
representations were true.  In fact, Netter and Dolphin used the Fund’s available cash to make

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new investments.
31. Defendants lacked the authority under the LPA to continue to maintain QUMU
and PBSOQ as Designated Investments (as QUMU was not illiquid or subject to trading
restrictions and PBSOQ had been fully liquidated).  And the side pocket provision of the LPA
limited the Designated Investments classification to a four-year period.  Nor did Defendants have
the authority to suspend withdrawals completely.  Yet Defendants never reallocated QUMU and
PBSOQ back to the Fund, lifted the suspension of withdrawals, or honored the redemption
requests.
32. Defendants’ management of the Designated Investments showed the falsity of
their representations about the limited liquidity and trading restrictions on those investments:
a. In May 2018, Netter resigned from the Board of Directors of QUMU.  This resignation
cured any trading restrictions on that stock because of the board seat.
b. Between June 2020 and September 2021, Dolphin actively traded QUMU stock on behalf
of the Fund.  Throughout this period, there was significant daily trading volume
(averaging over 200,000 shares per day) relative to the Fund’s holdings of QUMU
(approximately 500,000 shares).  This volume shows that the stock was not illiquid, as
Defendants had represented.
c. During that time, Netter also traded QUMU stock in his personal account.
d. In December 2021, Dolphin bought additional securities of an existing investment held
by the Fund, demonstrating Defendants’ failure to work to resolve any purported
restrictions on honoring investors’ withdrawal and redemption requests.
e. In 2021 and 2023, the Fund received cash from some of the Designated Investments, yet
still failed to return that cash to investors, despite their redemption requests.

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f. The Fund ceased holding PBSOQ stock in December 2021, and ceased holding QUMU
shares in February 2023.  Yet Dolphin and Netter continued their suspension of
withdrawals and refused to honor the investors’ redemption requests.  The Fund’s 2018
audited financial statement, provided to Fund investors in April 2023, included the false
representation that the resolution of the QUMU and PBSOQ investments continued to
require the suspension of withdrawals.
33. In other words, Defendants continued to hold liquid and unrestricted existing
investments with a view of generating investment returns, did not sell investments to raise cash
to satisfy withdrawals requests, and invested portions of cash held by the Fund in equity
securities rather than distributing it to redeeming investors.  Nor did Defendants accurately
describe the status of those investments, the reasons for the suspension of withdrawals, or its lack
of efforts to honor those withdrawals.
34. Through these failures and misrepresentations, Defendants breached their
fiduciary duty to the Fund, their responsibilities to their investors, and the anti-fraud provisions
of the Advisers Act.
Failure to Disclose Conflicts of Interest Relating to Netter’s Securities Trading
35. As part of their fraudulent scheme, Dolphin and Netter failed to disclose conflicts
of interest between the Fund and Netter resulting from Netter’s personal investment activities.
36. Netter bought and sold large quantities of several of the same small-cap stocks
that the Fund owned, including QUMU, Telephone and Data Systems Inc., Dallas News
Corporation, CVR Partners L.P., and United States Cellular Corporation.
37. Netter personally had long-term holdings in each of these stocks.
38. With QUMU, in October and November 2019, Netter sent “activist” letters on

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behalf of the Fund to company management advocating corporate actions consistent with long-
term investment.
39. Netter and the Fund jointly filed a beneficial ownership report for Dallas News
Corporation with the Commission due to, among other things, the size of their combined
ownership together with the relatively small capitalization of the companies (e.g., Dallas News
Corporation). As a result, Netter and the Fund had a combined ownership of the company’s
Series A stock greater than 5%.
40. Netter’s holdings of significant, long-term positions in the same securities as the
Fund created an actual or potential conflict of interest that Netter’s trading could diverge from
the Fund’s interests.  For example, Netter had an incentive to prevent the Fund from selling its
shares, which could have caused prices to decline, or to trade his own stock in advance or in lieu
of the Fund’s.
41. These actual or potential conflicts were particularly relevant once the Fund was
obligated to sell or otherwise relinquish securities to satisfy Fund investors’ withdrawal requests.
42. Additionally, Netter personally benefited from Fund’s activist efforts.  During the
period Netter was personally invested in QUMU and Dallas News Corporation, the Fund paid
over $90,000 in legal expenses in connection with activist efforts related to these companies.
Netter did not share in those expenses or disclose to investors his conflicts that resulted from his
personal investments in QUMU and Dallas News Corporation.
43. The Proposed Defendants never disclosed to the Fund or its investors that Netter
would make the same investments alongside the Fund.
Failure to Obtain Required Audits and Quarterly Financial Statements
44. Section 8.2 of the Fund’s LPA requires Dolphin to prepare and deliver audited

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financial statements prepared by an independent certified public accountant to Fund investors “as
soon as practicable after the end of each fiscal year,” and to prepare and deliver unaudited
financial statements to Fund investors generally within 45 days of the end of each quarter.
45. Between the end of fiscal year 2017 and June 2019, when the Fund had no Fund
administrator, Defendants did not maintain any Fund accounting.
46. Starting in June
2019, Dolphin had a new fund administrator prepare unaudited
financial statements for fiscal year 2018.
47. After fiscal year 2018, Dolphin has maintained no accounting records.
48. Defendants
failed to obtain or deliver in a timely manner an audit for fiscal year
2018.  Although Fund investors eventually received this audit, it was not completed or delivered
to investors until April 2023, more than four years after it was due to them.
49. The delay in the preparation and delivery of the 2018 audit resulted from Dolphin
and Netter’s delay in
signing an engagement letter with the auditor until 2021, two years after the
audits needed to be delivered to investors.  Then Dolphin and Netter caused additional delay by
failing to give the auditor the records it needed to complete the audit.
50.
Defendants have since failed to obtain or deliver unaudited quarterly financial
statements to Fund investors for any period from fiscal year 2019 through the present.  Dolphin
has not engaged any accounting firm to conduct audits for those time periods.
Overcharge of Management Fees
51. Defendants overcharged the Fund for management fees from December 2017
through June 2022.
52. After the departure of the Fund’s fund administrator, Defendants calculated the
management fees due to Dolphin from the Fund.

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53. Dolphin and Netter understood how to calculate the management fees in
accordance with the LPA.  But they failed to accurately calculate these fees, instead relying on
rough approximations to determine what to charge the Fund.
54. The amounts that Dolphin, through Netter, charged the Fund were largely round
numbers in the thousands.
55. As a result, from the first quarter of fiscal year 2018 through the third quarter of
fiscal year 2022, Defendants overcharged the Fund by about $41,000, and collected that overage
from the Fund.
CLAIMS FOR RELIEF
FIRST CLAIM FOR RELIEF
FRAUDULENT SCHEME CONCERNING REDEMPTIONS

Fraudulent Conduct by Investment Advisers
In Violation of Sections 206(1) and 206(2) of the Advisers Act
(Dolphin, Mr. Netter)

56. The
Commission repeats and incorporates by reference the allegations in
paragraphs 1 through 55 Error! Reference source not found.as if set forth fully here.
57. At all relevant times, Dolphin and Netter were “investment advisers” within the
meaning of Section 202(a)(11) of the Advisers Act [15 U.S.C. § 80b-2(a)(11)].  Both Dolphin
and Netter were in the business of providing investment advice concerning securities for
compensation.  Netter was also an investment adviser due to his ownership, management, and
control of Dolphin.
58. As set forth above, Dolphin and Netter are employing a fraudulent device,
scheme, or artifice to defraud the Fund through their retention of funds due to investors, their
failure to honor redemption requests and investor withdrawals, their false and misleading
material statements and fraudulent omissions concerning those requests and their reasons for

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retaining the money, and their failures to disclose the actual or potential conflicts involved.
59. Dolphin and Netter, by use of the mails or any means or instrumentality of
interstate commerce, directly or indirectly, acting intentionally, knowingly or recklessly have
employed or are employing devices, schemes, or artifices to defraud clients or potential clients.
60. As described above, Dolphin and Netter, through their retention of funds due to
investors, their failure to
honor redemption requests and investor withdrawals, their false and
misleading statements and fraudulent omissions concerning those requests and their reasons for
retaining the money, and their failures to disclose the actual or potential conflicts involved,
engaged in transactions, practices, or courses of business which operated as a fraud or deceit
upon the Fund.
61. Dolphin
and Netter, by use of the mails or any means or instrumentality of
interstate commerce, directly or indirectly, acting intentionally, knowingly, recklessly, or
negligently, have engaged or are engaging in transactions, practices, and courses of business
which operate as a fraud or deceit upon a client or prospective client.
62. By
engaging in the conduct described above, Defendants have violated, and unless
enjoined, will continue to violate Sections 206(1) and (2) of the Advisers Act [15 U.S.C. § 80b-
6(1) and (2)].
SECOND CLAIM FOR RELIEF
FRAUDULENT CONDUCT IN OVERCHARGING MANAGEMENT FEES

Fraudulent Conduct by Investment Advisers
In Violation of Sections 206(1) and (2) of the Advisers Act
(Dolphin, Mr. Netter)

63.
The Commission repeats and incorporates by reference the allegations in
paragraphs 1 through Error! Reference source not found.55 as if set forth fully here.
64. At all relevant times, Dolphin and Netter were “investment advisers” within the

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meaning of Section 202(a)(11) of the Advisers Act [15 U.S.C. § 80b-2(a)(11)].  Both Dolphin
and Netter were in the business of providing investment advice concerning securities for
compensation.  Netter was also an investment adviser due to his ownership, management, and
control of Dolphin.
65. As detailed above, Defendants fraudulently overcharged management fees during
their management of the Fund.
66. Dolphin
and Netter, by use of the mails or any means or instrumentality of
interstate commerce, directly or indirectly, acting intentionally, knowingly or recklessly have
employed or are employing devices, schemes, or artifices to defraud clients or potential clients.
67. Dolphin and Netter, by use of the mails or any means or instrumentality of
interstate commerce,
directly or indirectly, acting intentionally, knowingly, recklessly, or
negligently, have engaged or are engaging in transactions, practices, and courses of business
which operate as a fraud or deceit upon a client or prospective client.
68. By engaging in the conduct described above, Defendants have violated, and
unless enjoined, will
continue to violate Sections 206(1) and (2) of the Advisers Act [15 U.S.C. §
80b-6(1) and (2)].
THIRD CLAIM FOR RELIEF
FRAUDULENT CONDUCT IN FAILING TO
OBTAIN AND PROVIDE AUDITED AND UNAUDITED FINANCIAL STATEMENTS

Fraudulent Conduct by Investment Advisers
In Violation of Section 206(2) of the Advisers Act
(Dolphin, Mr. Netter)

69. The Commission repeats and incorporates by reference the allegations in
paragraphs 1 through Error! Reference source not found.55 as if set forth fully here.
70. At all relevant times, Dolphin and Netter were “investment advisers” within the

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meaning of Section 202(a)(11) of the Advisers Act [15 U.S.C. § 80b-2(a)(11)].  Both Dolphin
and Netter were in the business of providing investment advice concerning securities for
compensation.  Netter was also an investment adviser due to his ownership, management, and
control of Dolphin.
71. As detailed above, Defendants, in failing to obtain required audits and financial
statements, engaged in transactions, practices, and courses of business which operated as a fraud
or deceit upon their advisory clients.
72. Dolphin and Netter, by use of the mails or any means or instrumentality of
interstate commerce, directly or indirectly, acting intentionally, knowingly, recklessly, or
negligently, have engaged or are engaging in transactions, practices, and courses of business
which operate as a fraud or deceit upon a client or prospective client.
73. By
engaging in the conduct described above, Defendants have violated, and unless
enjoined, will continue to violate Section 206(2) of the Advisers Act [15 U.S.C. § 80b-6 (2)].
FOURTH CLAIM FOR RELIEF
FRAUDULENT MISREPRESENTATIONS
ABOUT SUSPENSION OF WITHDRAWALS

Fraudulent Conduct by Investment Advisers to a Pooled Investment Vehicle
In Violation of Section 206(4) of the Advisers Act and Rule 206(4)-8 Thereunder
(Dolphin, Mr. Netter)

74. The Commission repeats and incorporates by reference the allegations in
paragraphs 1 through Error! Reference source not found.55, as if set forth fully here.
75. At all relevant times, Dolphin and Netter were “investment advisers” within the
meaning of Section
202(a)(11) of the Advisers Act [15 U.S.C. § 80b-2(a)(11)].  Both Dolphin
and Netter were in the business of providing investment advice concerning securities for
compensation.  Netter was also an investment adviser due to his ownership, management, and

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control of Dolphin.
76. At all relevant times, the Fund was a pooled investment vehicle, as defined in
Advisers Act Rule 206(4)-8(b) [17 C.F.R. § 275.206(4)-8(b)].
77. As
set forth above, Dolphin and Netter made material misstatements to investors
in the Fund concerning the suspension of withdrawals.
78. Dolphin and Netter, acting intentionally, knowingly, recklessly, or negligently,
while acting as investment advisers to a pooled investment vehicle, by use of the mails, and the
means and instrumentalities of interstate commerce, directly or indirectly, engaged in acts,
practices, or courses of business which were fraudulent, deceptive, or manipulative.  Defendants
also made untrue statements of material facts and/or omitted to state a material fact necessary to
make the statements made, in the light of the circumstances in which they were made, not
misleading, to investors or prospective investors in the pooled investment vehicles, and
otherwise engaged in acts, practices, or courses of business that were fraudulent, deceptive, or
manipulative with respect to investors or prospective investors in the pooled investment vehicles.
79.
By engaging in the conduct described above, Defendants have violated, and,
unless enjoined, will continue to violate Section 206(4) of the Advisers Act [15 U.S.C. § 80b-
6(4)] and Rule 206(4)-8 thereunder [17 C.F.R. § 275.206(4)-8].
PRAYER FOR RELIEF
WHEREFORE, the Commission requests that this Court:
A. Enter permanent injunctions enjoining Defendants from violating Advisers Act
Sections 206(1), (2) and (4) [15 U.S.C. § 80b-6(1), (2) and (4)] and Rule 206(4)-8 thereunder [17
C.F.R. § 275.206(4)-8];
B. Order Defendants to pay appropriate civil monetary penalties pursuant to Section

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209(e) and (f) of the Advisers Act [15 U.S.C. § 80b-9(e) & (f)];
C. Require Defendants to disgorge their ill-gotten gains, pursuant to Sections
21(d)(5) and 21(d)(7) of the Securities Exchange Act of 1934, plus prejudgment interest;
D. Order Defendants to (i) within 60 days of the final judgment, process all investor
withdrawals requests received by Dolphin since 2016 and issue withdrawals to such investors,
subject to the audit holdback provisions of the Fund’s Limited Partnership Agreement; and (iii)
within 120 days of the final judgment, certify compliance with the above final judgment;
E. Enter a permanent injunction restraining and enjoining Netter from directly or
indirectly, acting as or being associated with any investment adviser.  This injunction shall not
prevent Netter from being a client of an investment adviser, and Netter may continue to be
associated with Dolphin, and its affiliates, to the extent necessary to wind down the operations of
the private funds managed by Dolphin, and its affiliates, and to assist with the administration of
investor withdrawals from the Fund, for a period of six months from entry of the Court’s order.
For purposes of this paragraph, a person is associated with an investment adviser if such person
is a partner, officer, or director of such investment adviser (or performs similar functions), or
directly or indirectly controls or is controlled by such investment adviser, including any
employee of such investment adviser;
F. Retain jurisdiction over this action to implement and carry out the terms of all
orders and decrees that may be entered; and,
G. Award any other relief that the Court deems just and proper.

Respectfully submitted,

      By:  /s/ Marc J. Jones
                                                                        Marc            J.            Jones            (Mass.            Bar            No.            645910)

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                                                                                    Senior            Trial            Counsel
                                                                        Mark            S.            Audet            (Mass.            Bar            No.            691009)
                                                                                    Enforcement            Counsel
                                                                        Colin            D.            Forbes            (N.Y.            Bar            No.            4664264)
       Assistant Director

      A
TTORNEYS FOR PLAINTIFF
S
ECURITIES AND EXCHANGE COMMISSION
33 Arch St., 24th Floor
Boston, MA 02110
Telephone: (617) 573-8900
Jones Direct Dial: (617) 573-8947
[email protected]

DATED: December 20, 2024

UNITED STATES DISTRICT COURT 
DISTRICT OF CONNECTICUT 

 
 

SECURITIES AND EXCHANGE COMMISSION, 
 

Plaintiff, 
 

v. 
 
DOLPHIN ASSOCIATES III, LLC and 
DONALD T. NETTER, 
 

Defendants. 

 
 
 
 

 
CIVIL ACTION NO.      

 
 
 
 
 
 

 
COMPLAINT 

Plaintiff United States Securities and Exchange Commission (“Commission”) alleges the 

following against Defendants Dolphin Associates III, LLC (“Dolphin”) and Donald T. Netter 

(“Netter”): 

SUMMARY OF THE ACTION 

1. From 2016 to the present, Defendants Dolphin, an investment adviser, and Netter, 

its principal, defrauded their private fund client, Dolphin Limited Partnership III, L.P. (“Fund”) 

and its investors, and breached their fiduciary duties to the Fund, by improperly withholding the 

investors’ funds, failing to provide required financial statements, and overcharging them.   

2. Through their management of the Fund, Defendants employed a fraudulent 

scheme and engaged in a course of business that operated as a fraud or deceit on their client and 

its investors in these ways: 

3. Failing to Honor Investor Redemption Requests and Misrepresenting the 

Reasons Why:  First, Defendants engaged in a fraudulent scheme and engaged in a course of 

business that operated as a fraud or deceit on their clients by improperly suspending investor 

Case 3:24-cv-02022     Document 1     Filed 12/20/24     Page 1 of 17



 

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withdrawals and failing to honor valid investor redemption requests.  Throughout this scheme, 

Defendants made false and misleading statements about the suspension of withdrawals and failed 

to disclose conflicts of interest, or potential conflicts of interest, associated with their decision to 

suspend withdrawals.  By engaging in this scheme and course of business, Defendants have 

violated and continue to violate Sections 206(1), (2), and (4) of the Investment Advisers Act of 

1940 (“Advisers Act”) and Rule 206(4)-8 thereunder.   

4. Failing to Obtain or Provide Audited and Unaudited Financial Statements: 

Second, Defendants engaged in a transaction, practice, or course of business that operated as a 

fraud or deceit on the Fund by failing to obtain and deliver required annual audits and quarterly 

financial reports to investors.  By doing so, Defendants have violated and continue to violate 

Section 206(2) of the Advisers Act.   

5. Overcharging Management Fees:  Third, Defendants engaged in a transaction, 

practice, or course of business that operated as a fraud or deceit on the Fund by failing to 

properly calculate management fees, resulting in overcharging the Fund by about $41,000.  By 

doing so, Defendants have violated and continue to violate Sections 206(1) and 206(2) of the 

Advisers Act.   

6. Based on these violations, the Commission seeks: 

a. Entry of permanent injunctions enjoining Defendants from violating Sections 206 

(1), (2), and (4) of the Advisers Act and Rule 206(4)-8 thereunder; 

b. Appropriate civil monetary penalties pursuant to Section 209(e) of the Advisers 

Act [15 U.S.C. § 80b-9(e)]; 

c. Disgorgement of Defendants’ ill-gotten gains, pursuant to Sections 21(d)(5) and 

21(d)(7) of the Securities Exchange Act of 1934, plus prejudgment interest;  

Case 3:24-cv-02022     Document 1     Filed 12/20/24     Page 2 of 17



 

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d. Entry of an Order requiring Defendants to (i) within 60 days of the final 

judgment, process all investor withdrawals requests received by Dolphin since 

2016 and issue withdrawals to such investors, subject to the audit holdback 

provisions of the Fund’s Limited Partnership Agreement; and (ii) within 120 days 

of the final judgment, certify compliance with the above final judgment;  

e. Entry of a permanent injunction restraining and enjoining Netter from directly or 

indirectly, acting as or being associated with any investment adviser; and, 

f. award any other relief that the Court deems just and proper. 

DEFENDANTS 

7. Dolphin Associates III, LLC, is a Delaware limited liability company based in 

Greenwich, Connecticut.  Dolphin has never been registered with the Commission.  Dolphin 

filed an initial Form ADV as an exempt reporting adviser (“ERA”) on June 28, 2012, and 

currently maintains status as an ERA.   

8. Dolphin serves as the investment adviser and general partner to a privately offered 

investment fund, Dolphin Limited Partnership III, L.P.  Dolphin is also an investor in the Fund.   

9. Donald T. Netter, age 63, is a resident of Greenwich, Connecticut, and is the 

founder and Senior Partner of Dolphin.  He is also an investor in the Fund.  Mr. Netter has never 

held licenses relevant to the securities or accounting industries.  Netter is Dolphin’s only 

employee. 

10. Netter and Dolphin are engaged in the business of advising others as to the value 

of securities or as to the advisability of investing in, purchasing, or selling securities.  They 

receive compensation for these services.   

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JURISDICTION AND VENUE 

11. The Court has jurisdiction over this action pursuant to Sections 209(d) and 214 of 

the Advisers Act, 15 U.S.C. §§ 80b-9(d) and 80b-14.  

12. The Commission seeks permanent injunctions and disgorgement pursuant to 

Section 209(d) of the Advisers Act, 15 U.S.C. § 80b-9(d).  The Commission seeks the imposition 

of civil penalties pursuant to Section 209(e) of the Advisers Act, 15 U.S.C. § 80b-9(e). 

13. The Court has personal jurisdiction over Defendants and venue is proper in this 

District because Defendants reside and transact business in this District, and many acts and 

omissions constituting the alleged violations occurred, in whole or in part, in this District.   

14. Defendants directly or indirectly used the mails or the means or instruments of 

transportation or communication in interstate commerce in connection with their business as 

investment advisers and the conduct described in this Complaint. 

15. Unless enjoined, Defendants will continue to engage in the securities law 

violations alleged here, or in similar conduct that would violate the federal securities laws. 

DEFENDANTS’ ONGOING FRAUDULENT COURSE OF CONDUCT 

16. Defendants are engaged in an ongoing course of conduct that includes multiple 

breaches of their fiduciary duties to their client (the Fund) and their responsibilities to investors 

in that Fund, as well as misleading misrepresentations and fraudulent omissions. 

17. This course of conduct includes failing to honor redemption requests by investors 

and return invested capital to those investors and misrepresenting the reasons for those failures; 

improperly calculating management fees and overcharging the Fund for management services; 

and failing to obtain required audits and quarterly financial statements and to distribute them to 

investors.   

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Failure to Honor Redemption Requests and Investor Withdrawals 

18. Defendants improperly suspended investor withdrawals from the Fund and 

refused to honor redemption requests by investors, keeping investors invested in the Fund well 

after they were entitled to the return of their invested money.  

19. Section 4.7 of the Fund’s Limited Partnership Agreement (“LPA”), which was 

distributed to all investors by Defendants, permitted Defendants to create “Designated 

Investments.”  Designated Investments “are not publicly traded or otherwise have limited 

liquidity or which the General Partner [  ] believes in good faith are likely to become private or 

have limited liquidity….” 

20. In 2015, Defendants classified two Fund holdings (QUMU Corporation 

(“QUMU”) and Point Blank Solutions, Inc. (“PBSOQ”)) as “Designated Investments” under 

Section 4.7 of the LPA.  Doing so segregated those investments from the Fund’s main portfolio 

and placed them in a “side pocket,” excluding them from investor withdrawals for up to four 

years.  Defendants stated they were making this classification because the investments had 

limited liquidity and trading restrictions.   

21. For QUMU, the trading restrictions resulted from the fact that Netter had been 

appointed to the company’s board of directors.   

22. As for PBSOQ, the stock ceased to be publicly traded, and the Fund’s interest in it 

became bound up in an illiquid trust.   

23. Under Section 4.7 of the LPA, Dolphin could side pocket those two investments and 

exclude them from investor withdrawals for up to four years, until 2019. 

24. Three Fund investors made several redemption requests starting in August 2016 

and continuing through December 2021.  Defendants have continually failed to honor these 

requests or to take any necessary steps to allow them to be honored. 

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25. Towards the end of 2016, Defendants improperly suspended all investor 

withdrawals from the Fund.  In a letter to Fund investors dated November 30, 2016, Dolphin and 

Netter stated that the reason for the suspension was “the concentration of several core positions” 

including QUMU, “and also based upon the concentrated holdings of the Partners.”  The letter 

claimed that the suspension had been ordered under Section 6.6(c) of the LPA. 

26. Section 6.6(c) of the LPA gives Dolphin authority to suspend withdrawals 

altogether under specific circumstances, including, inter alia, “a state of emergency or other 

unusual or extraordinary circumstances” that makes it difficult to dispose of a substantial part of, 

or fairly value, the Fund’s assets, or that “might seriously prejudice the Partners.”  

27. Later communications with Fund investors make clear that, in fact, the suspension 

was due to the Fund’s positions in QUMU and PBSOQ, the two securities that Defendants had 

already side-pocketed.  In the Fund’s audited financial statements for 2017 and 2018, Dolphin 

stated that the suspension of withdrawals would last until QUMU and PBSOQ were 

“appropriately resolved and reallocated back to the Partnership.”   

28. The status of QUMU and PSBOQ, which had already been side-pocketed, would 

not have prevented the Fund from selling other portfolio assets to at least partially satisfy the 

redemption requests from the Fund’s investors.  

29. And, despite their representations, neither Dolphin nor Netter took any steps to 

resolve and reallocate back to the Partnership the investments in QUMU and PBSOQ.   

30. Between 2016 and 2019, after the suspension of withdrawals was instituted, 

Netter told at least one Fund investor that Dolphin was winding down the Fund, refraining from 

making new investments, and selling positions to satisfy redemption requests.  None of these 

representations were true.  In fact, Netter and Dolphin used the Fund’s available cash to make 

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new investments. 

31. Defendants lacked the authority under the LPA to continue to maintain QUMU 

and PBSOQ as Designated Investments (as QUMU was not illiquid or subject to trading 

restrictions and PBSOQ had been fully liquidated).  And the side pocket provision of the LPA 

limited the Designated Investments classification to a four-year period.  Nor did Defendants have 

the authority to suspend withdrawals completely.  Yet Defendants never reallocated QUMU and 

PBSOQ back to the Fund, lifted the suspension of withdrawals, or honored the redemption 

requests.   

32. Defendants’ management of the Designated Investments showed the falsity of 

their representations about the limited liquidity and trading restrictions on those investments: 

a. In May 2018, Netter resigned from the Board of Directors of QUMU.  This resignation 

cured any trading restrictions on that stock because of the board seat. 

b. Between June 2020 and September 2021, Dolphin actively traded QUMU stock on behalf 

of the Fund.  Throughout this period, there was significant daily trading volume 

(averaging over 200,000 shares per day) relative to the Fund’s holdings of QUMU 

(approximately 500,000 shares).  This volume shows that the stock was not illiquid, as 

Defendants had represented.   

c. During that time, Netter also traded QUMU stock in his personal account.   

d. In December 2021, Dolphin bought additional securities of an existing investment held 

by the Fund, demonstrating Defendants’ failure to work to resolve any purported 

restrictions on honoring investors’ withdrawal and redemption requests.   

e. In 2021 and 2023, the Fund received cash from some of the Designated Investments, yet 

still failed to return that cash to investors, despite their redemption requests.   

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f. The Fund ceased holding PBSOQ stock in December 2021, and ceased holding QUMU 

shares in February 2023.  Yet Dolphin and Netter continued their suspension of 

withdrawals and refused to honor the investors’ redemption requests.  The Fund’s 2018 

audited financial statement, provided to Fund investors in April 2023, included the false 

representation that the resolution of the QUMU and PBSOQ investments continued to 

require the suspension of withdrawals.   

33. In other words, Defendants continued to hold liquid and unrestricted existing 

investments with a view of generating investment returns, did not sell investments to raise cash 

to satisfy withdrawals requests, and invested portions of cash held by the Fund in equity 

securities rather than distributing it to redeeming investors.  Nor did Defendants accurately 

describe the status of those investments, the reasons for the suspension of withdrawals, or its lack 

of efforts to honor those withdrawals.   

34. Through these failures and misrepresentations, Defendants breached their 

fiduciary duty to the Fund, their responsibilities to their investors, and the anti-fraud provisions 

of the Advisers Act.   

Failure to Disclose Conflicts of Interest Relating to Netter’s Securities Trading 

35. As part of their fraudulent scheme, Dolphin and Netter failed to disclose conflicts 

of interest between the Fund and Netter resulting from Netter’s personal investment activities.  

36. Netter bought and sold large quantities of several of the same small-cap stocks 

that the Fund owned, including QUMU, Telephone and Data Systems Inc., Dallas News 

Corporation, CVR Partners L.P., and United States Cellular Corporation. 

37. Netter personally had long-term holdings in each of these stocks. 

38. With QUMU, in October and November 2019, Netter sent “activist” letters on 

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behalf of the Fund to company management advocating corporate actions consistent with long-

term investment. 

39. Netter and the Fund jointly filed a beneficial ownership report for Dallas News 

Corporation with the Commission due to, among other things, the size of their combined 

ownership together with the relatively small capitalization of the companies (e.g., Dallas News 

Corporation). As a result, Netter and the Fund had a combined ownership of the company’s 

Series A stock greater than 5%. 

40. Netter’s holdings of significant, long-term positions in the same securities as the 

Fund created an actual or potential conflict of interest that Netter’s trading could diverge from 

the Fund’s interests.  For example, Netter had an incentive to prevent the Fund from selling its 

shares, which could have caused prices to decline, or to trade his own stock in advance or in lieu 

of the Fund’s. 

41. These actual or potential conflicts were particularly relevant once the Fund was 

obligated to sell or otherwise relinquish securities to satisfy Fund investors’ withdrawal requests.  

42. Additionally, Netter personally benefited from Fund’s activist efforts.  During the 

period Netter was personally invested in QUMU and Dallas News Corporation, the Fund paid 

over $90,000 in legal expenses in connection with activist efforts related to these companies.  

Netter did not share in those expenses or disclose to investors his conflicts that resulted from his 

personal investments in QUMU and Dallas News Corporation.  

43. The Proposed Defendants never disclosed to the Fund or its investors that Netter 

would make the same investments alongside the Fund.  

Failure to Obtain Required Audits and Quarterly Financial Statements 

44. Section 8.2 of the Fund’s LPA requires Dolphin to prepare and deliver audited 

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financial statements prepared by an independent certified public accountant to Fund investors “as 

soon as practicable after the end of each fiscal year,” and to prepare and deliver unaudited 

financial statements to Fund investors generally within 45 days of the end of each quarter. 

45. Between the end of fiscal year 2017 and June 2019, when the Fund had no Fund 

administrator, Defendants did not maintain any Fund accounting.   

46. Starting in June 2019, Dolphin had a new fund administrator prepare unaudited 

financial statements for fiscal year 2018.   

47. After fiscal year 2018, Dolphin has maintained no accounting records. 

48. Defendants failed to obtain or deliver in a timely manner an audit for fiscal year 

2018.  Although Fund investors eventually received this audit, it was not completed or delivered 

to investors until April 2023, more than four years after it was due to them.   

49. The delay in the preparation and delivery of the 2018 audit resulted from Dolphin 

and Netter’s delay in signing an engagement letter with the auditor until 2021, two years after the 

audits needed to be delivered to investors.  Then Dolphin and Netter caused additional delay by 

failing to give the auditor the records it needed to complete the audit.   

50. Defendants have since failed to obtain or deliver unaudited quarterly financial 

statements to Fund investors for any period from fiscal year 2019 through the present.  Dolphin 

has not engaged any accounting firm to conduct audits for those time periods. 

Overcharge of Management Fees 

51. Defendants overcharged the Fund for management fees from December 2017 

through June 2022.   

52. After the departure of the Fund’s fund administrator, Defendants calculated the 

management fees due to Dolphin from the Fund.   

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53. Dolphin and Netter understood how to calculate the management fees in 

accordance with the LPA.  But they failed to accurately calculate these fees, instead relying on 

rough approximations to determine what to charge the Fund.   

54. The amounts that Dolphin, through Netter, charged the Fund were largely round 

numbers in the thousands.     

55. As a result, from the first quarter of fiscal year 2018 through the third quarter of 

fiscal year 2022, Defendants overcharged the Fund by about $41,000, and collected that overage 

from the Fund. 

CLAIMS FOR RELIEF 

FIRST CLAIM FOR RELIEF 
FRAUDULENT SCHEME CONCERNING REDEMPTIONS 

 
Fraudulent Conduct by Investment Advisers 

In Violation of Sections 206(1) and 206(2) of the Advisers Act 
(Dolphin, Mr. Netter) 

 
56. The Commission repeats and incorporates by reference the allegations in 

paragraphs 1 through 55 Error! Reference source not found.as if set forth fully here. 

57. At all relevant times, Dolphin and Netter were “investment advisers” within the 

meaning of Section 202(a)(11) of the Advisers Act [15 U.S.C. § 80b-2(a)(11)].  Both Dolphin 

and Netter were in the business of providing investment advice concerning securities for 

compensation.  Netter was also an investment adviser due to his ownership, management, and 

control of Dolphin.   

58. As set forth above, Dolphin and Netter are employing a fraudulent device, 

scheme, or artifice to defraud the Fund through their retention of funds due to investors, their 

failure to honor redemption requests and investor withdrawals, their false and misleading 

material statements and fraudulent omissions concerning those requests and their reasons for 

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retaining the money, and their failures to disclose the actual or potential conflicts involved. 

59. Dolphin and Netter, by use of the mails or any means or instrumentality of 

interstate commerce, directly or indirectly, acting intentionally, knowingly or recklessly have 

employed or are employing devices, schemes, or artifices to defraud clients or potential clients. 

60. As described above, Dolphin and Netter, through their retention of funds due to 

investors, their failure to honor redemption requests and investor withdrawals, their false and 

misleading statements and fraudulent omissions concerning those requests and their reasons for 

retaining the money, and their failures to disclose the actual or potential conflicts involved, 

engaged in transactions, practices, or courses of business which operated as a fraud or deceit 

upon the Fund.   

61. Dolphin and Netter, by use of the mails or any means or instrumentality of 

interstate commerce, directly or indirectly, acting intentionally, knowingly, recklessly, or 

negligently, have engaged or are engaging in transactions, practices, and courses of business 

which operate as a fraud or deceit upon a client or prospective client. 

62. By engaging in the conduct described above, Defendants have violated, and unless 

enjoined, will continue to violate Sections 206(1) and (2) of the Advisers Act [15 U.S.C. § 80b-

6(1) and (2)]. 

SECOND CLAIM FOR RELIEF 
FRAUDULENT CONDUCT IN OVERCHARGING MANAGEMENT FEES 

 
Fraudulent Conduct by Investment Advisers 

In Violation of Sections 206(1) and (2) of the Advisers Act  
(Dolphin, Mr. Netter) 

 
63. The Commission repeats and incorporates by reference the allegations in 

paragraphs 1 through Error! Reference source not found.55 as if set forth fully here. 

64. At all relevant times, Dolphin and Netter were “investment advisers” within the 

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meaning of Section 202(a)(11) of the Advisers Act [15 U.S.C. § 80b-2(a)(11)].  Both Dolphin 

and Netter were in the business of providing investment advice concerning securities for 

compensation.  Netter was also an investment adviser due to his ownership, management, and 

control of Dolphin.   

65. As detailed above, Defendants fraudulently overcharged management fees during 

their management of the Fund.   

66. Dolphin and Netter, by use of the mails or any means or instrumentality of 

interstate commerce, directly or indirectly, acting intentionally, knowingly or recklessly have 

employed or are employing devices, schemes, or artifices to defraud clients or potential clients. 

67. Dolphin and Netter, by use of the mails or any means or instrumentality of 

interstate commerce, directly or indirectly, acting intentionally, knowingly, recklessly, or 

negligently, have engaged or are engaging in transactions, practices, and courses of business 

which operate as a fraud or deceit upon a client or prospective client. 

68. By engaging in the conduct described above, Defendants have violated, and 

unless enjoined, will continue to violate Sections 206(1) and (2) of the Advisers Act [15 U.S.C. § 

80b-6(1) and (2)]. 

THIRD CLAIM FOR RELIEF 
FRAUDULENT CONDUCT IN FAILING TO 

OBTAIN AND PROVIDE AUDITED AND UNAUDITED FINANCIAL STATEMENTS 
 

Fraudulent Conduct by Investment Advisers 
In Violation of Section 206(2) of the Advisers Act  

(Dolphin, Mr. Netter) 
 

69. The Commission repeats and incorporates by reference the allegations in 

paragraphs 1 through Error! Reference source not found.55 as if set forth fully here. 

70. At all relevant times, Dolphin and Netter were “investment advisers” within the 

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meaning of Section 202(a)(11) of the Advisers Act [15 U.S.C. § 80b-2(a)(11)].  Both Dolphin 

and Netter were in the business of providing investment advice concerning securities for 

compensation.  Netter was also an investment adviser due to his ownership, management, and 

control of Dolphin.   

71. As detailed above, Defendants, in failing to obtain required audits and financial 

statements, engaged in transactions, practices, and courses of business which operated as a fraud 

or deceit upon their advisory clients.   

72. Dolphin and Netter, by use of the mails or any means or instrumentality of 

interstate commerce, directly or indirectly, acting intentionally, knowingly, recklessly, or 

negligently, have engaged or are engaging in transactions, practices, and courses of business 

which operate as a fraud or deceit upon a client or prospective client. 

73. By engaging in the conduct described above, Defendants have violated, and unless 

enjoined, will continue to violate Section 206(2) of the Advisers Act [15 U.S.C. § 80b-6 (2)]. 

FOURTH CLAIM FOR RELIEF 
FRAUDULENT MISREPRESENTATIONS  

ABOUT SUSPENSION OF WITHDRAWALS 
 

Fraudulent Conduct by Investment Advisers to a Pooled Investment Vehicle 
In Violation of Section 206(4) of the Advisers Act and Rule 206(4)-8 Thereunder 

(Dolphin, Mr. Netter) 
 

74. The Commission repeats and incorporates by reference the allegations in 

paragraphs 1 through Error! Reference source not found.55, as if set forth fully here. 

75. At all relevant times, Dolphin and Netter were “investment advisers” within the 

meaning of Section 202(a)(11) of the Advisers Act [15 U.S.C. § 80b-2(a)(11)].  Both Dolphin 

and Netter were in the business of providing investment advice concerning securities for 

compensation.  Netter was also an investment adviser due to his ownership, management, and 

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control of Dolphin.   

76. At all relevant times, the Fund was a pooled investment vehicle, as defined in 

Advisers Act Rule 206(4)-8(b) [17 C.F.R. § 275.206(4)-8(b)]. 

77. As set forth above, Dolphin and Netter made material misstatements to investors 

in the Fund concerning the suspension of withdrawals.   

78. Dolphin and Netter, acting intentionally, knowingly, recklessly, or negligently,  

while acting as investment advisers to a pooled investment vehicle, by use of the mails, and the 

means and instrumentalities of interstate commerce, directly or indirectly, engaged in acts, 

practices, or courses of business which were fraudulent, deceptive, or manipulative.  Defendants 

also made untrue statements of material facts and/or omitted to state a material fact necessary to 

make the statements made, in the light of the circumstances in which they were made, not 

misleading, to investors or prospective investors in the pooled investment vehicles, and 

otherwise engaged in acts, practices, or courses of business that were fraudulent, deceptive, or 

manipulative with respect to investors or prospective investors in the pooled investment vehicles.   

79. By engaging in the conduct described above, Defendants have violated, and, 

unless enjoined, will continue to violate Section 206(4) of the Advisers Act [15 U.S.C. § 80b-

6(4)] and Rule 206(4)-8 thereunder [17 C.F.R. § 275.206(4)-8]. 

PRAYER FOR RELIEF 

WHEREFORE, the Commission requests that this Court: 

A. Enter permanent injunctions enjoining Defendants from violating Advisers Act 

Sections 206(1), (2) and (4) [15 U.S.C. § 80b-6(1), (2) and (4)] and Rule 206(4)-8 thereunder [17 

C.F.R. § 275.206(4)-8];  

B. Order Defendants to pay appropriate civil monetary penalties pursuant to Section 

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209(e) and (f) of the Advisers Act [15 U.S.C. § 80b-9(e) & (f)]; 

C. Require Defendants to disgorge their ill-gotten gains, pursuant to Sections 

21(d)(5) and 21(d)(7) of the Securities Exchange Act of 1934, plus prejudgment interest; 

D. Order Defendants to (i) within 60 days of the final judgment, process all investor 

withdrawals requests received by Dolphin since 2016 and issue withdrawals to such investors, 

subject to the audit holdback provisions of the Fund’s Limited Partnership Agreement; and (iii) 

within 120 days of the final judgment, certify compliance with the above final judgment;  

E. Enter a permanent injunction restraining and enjoining Netter from directly or 

indirectly, acting as or being associated with any investment adviser.  This injunction shall not 

prevent Netter from being a client of an investment adviser, and Netter may continue to be 

associated with Dolphin, and its affiliates, to the extent necessary to wind down the operations of 

the private funds managed by Dolphin, and its affiliates, and to assist with the administration of 

investor withdrawals from the Fund, for a period of six months from entry of the Court’s order.  

For purposes of this paragraph, a person is associated with an investment adviser if such person 

is a partner, officer, or director of such investment adviser (or performs similar functions), or 

directly or indirectly controls or is controlled by such investment adviser, including any 

employee of such investment adviser; 

F. Retain jurisdiction over this action to implement and carry out the terms of all 

orders and decrees that may be entered; and,  

G. Award any other relief that the Court deems just and proper.   

 
Respectfully submitted, 
 

 
      By:  /s/ Marc J. Jones    
      Marc J. Jones (Mass. Bar No. 645910) 

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       Senior Trial Counsel 
      Mark S. Audet (Mass. Bar No. 691009) 
       Enforcement Counsel 
      Colin D. Forbes (N.Y. Bar No. 4664264) 
       Assistant Director 
             
      ATTORNEYS FOR PLAINTIFF  

SECURITIES AND EXCHANGE COMMISSION  
33 Arch St., 24th Floor 
Boston, MA 02110 
Telephone: (617) 573-8900 
Jones Direct Dial: (617) 573-8947 
[email protected] 
 

DATED: December 20, 2024 
 
 

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