SEC v. HEDONOVA LLC, No. 2:24-cv-05293, Central District of California (Nov. 21, 2024)

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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

UNITED STATES SECURITIES
AND EXCHANGE COMMISSION,
Plaintiff,

vs.
HEDONOVA LLC and HEDONOVA
ADVISORS LLC,
Defendants.

 Case No. 2:24-cv-05293-AB-E

ORDER OF PRELIMINARY
INJUNCTION

This matter came before the Court upon the Consent of Defendants and
Stipulation for Preliminary Injunction (“Consent and Stipulation”) by and between
Plaintiff Securities and Exchange Commission (“SEC” or “Commission”) and
Defendants Hedonova Fund LLC and Hedonova Advisors LLC (collectively with
Hedonova Fund LLC, the “Defendants”).
The Court, having considered the Consent and Stipulation, as well as the
Complaint (Dkt. 1), Amended Answer (Dkt. 45), and Docket Entry Nos. 13–15, 19,
24 and 46, finds that:

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A. This Court has jurisdiction over the parties to, and the subject matter of,
this action.
B. Defendants have consented and the parties have stipulated to entry of the
following Order.
C. Defendants neither admit nor deny the allegations of the Complaint
(except as to the Commission’s allegations concerning personal and
subject matter jurisdiction, which Defendants admit), or that “Good
cause” exists as stated in Paragraph E.  Nothing in this Order precludes
Defendants from contesting the allegations or claims in the SEC’s
Complaint.
D. Defendants will not oppose enforcement of this Order of Preliminary
Injunction on the ground, if any exists, that it fails to comply with Rule
65 of the Federal Rules of Civil Procedure or any statutes or judicial
precedent regarding preliminary injunctions, and waive any such
objection.
E. For purposes of this Stipulated Order, good cause exists to believe that
(1) the SEC is likely to succeed on the merits of its claim that
Defendants Hedonova LLC and Hedonova Advisors LLC have engaged
in, are engaging in, are about to engage in, and will continue to engage
in transactions, acts, practices and courses of business that constitute
violations of Section 17(a) of the Securities Act of 1933 (“Securities
Act”) [15 U.S.C. § 77q(a)]; Section 10(b) of the Securities Exchange Act
of 1934 (“Exchange Act”) [15 U.S.C. § 78j(b)] and Rule 10b-5
thereunder [17 C.F.R. § 240.10b-5]; and that Defendant Hedonova
Advisors LLC has engaged in, is engaging in, is about to engage in, and
will continue to engage in transactions, acts, practices and courses of
business that constitute violations of Section 206(4) of the Investment
Advisers Act of 1940 (“Advisers Act”) [15 U.S.C. § 80b-6(4)] and Rule

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206(4)-8 thereunder [17 C.F.R. § 275.206(4)-8]; (2) irreparable harm
will result in the absence of the emergency or preliminary relief; (3) the
balance of equities tips in the SEC’s favor; and (4) an injunction is in the
public interest.
PRELIMINARY INJUNCTION ORDER
I.
IT IS HEREBY ORDERED that Defendants Hedonova LLC and Hedonova
Advisors LLC are preliminarily enjoined from violating, directly or indirectly,
Section 10(b) of the Securities Exchange Act of 1934 [15 U.S.C. § 78j(b)] and Rule
10b-5 promulgated thereunder [17 C.F.R. § 240.10b-5], by using any means or
instrumentality of interstate commerce, or of the mails, or of any facility of any
national securities exchange, in connection with the purchase or sale of any security:
(a) to employ any device, scheme, or artifice to defraud;
(b) to make any untrue statement of a material fact or to omit to state a material
fact necessary in order to make the statements made, in the light of the circumstances
under which they were made, not misleading; or
(c) to engage in any act, practice, or course of business which operates or
would operate as a fraud or deceit upon any person.
IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that,
as provided in Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also
binds the following who receive actual notice of this Preliminary Injunction Order
(“Order”) by personal service or otherwise: (a) Defendants’ officers, agents, servants,
employees, and attorneys, and (b) other persons in active concert or participation with
Defendants or with anyone described in (a).
II.
IT IS HEREBY FURTHER ORDERED that Defendants Hedonova LLC and
Hedonova Advisors LLC are preliminarily enjoined from violating Section 17(a) of
the Securities Act of 1933 [15 U.S.C. § 77q(a)] in the offer or sale of any security by

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the use of any means or instruments of transportation or communication in interstate
commerce or by use of the mails, directly or indirectly:
(a) to employ any device, scheme, or artifice to defraud;
(b) to obtain money or property by means of any untrue statement of a material
fact or any omission of a material fact necessary in order to make the statements
made, in light of the circumstances under which they were made, not misleading; or
(c) to engage in any transaction, practice, or course of business which operates
or would operate as a fraud or deceit upon the purchaser.
IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that,
as provided in Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also
binds the following who receive actual notice of this Order by personal service or
otherwise: (a) Defendants’ officers, agents, servants, employees, and attorneys, and
(b) other persons in active concert or participation with Defendants or with anyone
described in (a).
III.
IT IS HEREBY FURTHER ORDERED that Defendant Hedonova Advisors
LLC is preliminarily enjoined from violating Section 206(4) of the Investment
Advisers Act of 1940 [15 U.S.C. §§ 80b-6(4)] and Rule 206(4)-8 thereunder [17
C.F.R. § 275.206(4)-8] while serving as an investment adviser to a pooled investment
vehicle by the use of the mails or means and instrumentalities of interstate commerce
or by use of the mails, directly or indirectly:
(a) to make an untrue statement of a material fact or to omit to state a material
fact necessary to make the statements made, in light of the circumstances under
which they were made, not misleading to any investor or prospective investor in the
pooled investment vehicle; or
(b) to engage in any act, practice, or course of business that is fraudulent,
deceptive, or manipulative with respect to any investor or prospective investor in the
pooled investment vehicle.

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IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that,
as provided in Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also
binds the following who receive actual notice of this Order by personal service or
otherwise: (a) Defendant Hedonova Advisors LLC’s officers, agents, servants,
employees, and attorneys, and (b) other persons in active concert or participation with
Defendant Hedonova Advisors LLC or with anyone described in (a).
IV.
IT IS HEREBY FURTHER ORDERED that Defendants Hedonova LLC and
Hedonova Advisors LLC are, pending resolution of this action, prohibited from
participating on and after the date of this Order in the issuance, purchase, offer, or
sale of securities, including but not limited to the solicitation or receipt of money for
any investment opportunity however described, to any investor located in the United
States.
IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that,
as provided in Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also
binds the following who receive actual notice of this Order by personal service or
otherwise: (a) Defendants’ officers, agents, servants, employees, and attorneys, and
(b) other persons in active concert or participation with Defendants or with anyone
described in (a).
V.
IT IS HEREBY FURTHER ORDERED that Defendants Hedonova LLC and
Hedonova Advisors LLC are, pending resolution of this action, required within 5
business days of the issuance of this order to post in a prominent place on the
homepage of the website located at Hedonova.io, when accessed from the United
States, as well as on the homepage of any website subsequently created by
Defendants that is available to investors and prospective investors located in the
United States, and in a prominent place in the mobile application software
Defendants have made available to investors and prospective investors located in the

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United States:
(a) the following statement: “On June 24, 2024, the United States Securities
and Exchange Commission filed a Complaint in the United States District Court for
the Central District of California alleging that Hedonova LLC and Hedonova
Advisors LLC (“Defendants”) violated certain anti-fraud provisions of the federal
securities laws.  On August 14, 2024, Defendants filed an Amended Answer denying
in relevant part the allegations of the Complaint.”;
(b) a hyperlink to a copy of the Commission’s Complaint (Dkt. 1);
(c) a hyperlink to a copy of Defendants’ Amended Answer to the Complaint
(Dkt. 45); and
(d) a hyperlink to a copy of this Order of Preliminary Injunction (Dkt. __).
IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that,
as provided in Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also
binds the following who receive actual notice of this Order by personal service or
otherwise: (a) Defendants’ officers, agents, servants, employees, and attorneys, and
(b) other persons in active concert or participation with Defendants or with anyone
described in (a).
VI.
IT IS FURTHER ORDERED that Defendant Hedonova Advisors LLC must
file an amended correct and accurate Form ADV with the Commission within 7
business days of the issuance of this order.
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IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that,
as provided in Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also
binds the following who receive actual notice of this Order by personal service or
otherwise: (a) Defendant Hedonova Advisors LLC’s officers, agents, servants,

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 Any revisions to the Form ADV may not be construed as an admission that prior
statements as alleged in the Complaint were false or misleading.

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employees, and attorneys, and (b) other persons in active concert or participation with
Defendant Hedonova Advisors LLC or with anyone described in (a).
VII.
IT IS HEREBY FURTHER ORDERED that:
A. The Court shall retain jurisdiction over this action for all purposes.
B. Pursuant to Federal Rule of Civil Procedure 65(c), no security is
required of the Commission.
C. This Preliminary Injunction shall remain in effect until entry of Final
Judgment in, or other final disposition of, this action, or further Order of this Court.

IT IS SO ORDERED.

Dated: November 18, 2024 _______________________________________
HONORABLE ANDRÉ BIROTTE JR.
UNITED STATES DISTRICT COURT JUDGE

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UNITED STATES DISTRICT COURT 

CENTRAL DISTRICT OF CALIFORNIA 

 

UNITED STATES SECURITIES 
AND EXCHANGE COMMISSION, 

Plaintiff, 
 

vs. 

HEDONOVA LLC and HEDONOVA 
ADVISORS LLC, 

Defendants. 
 

 Case No. 2:24-cv-05293-AB-E 
 
ORDER OF PRELIMINARY 
INJUNCTION  
 
 
 

   
This matter came before the Court upon the Consent of Defendants and 

Stipulation for Preliminary Injunction (“Consent and Stipulation”) by and between 

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

Defendants Hedonova Fund LLC and Hedonova Advisors LLC (collectively with 

Hedonova Fund LLC, the “Defendants”). 

The Court, having considered the Consent and Stipulation, as well as the 

Complaint (Dkt. 1), Amended Answer (Dkt. 45), and Docket Entry Nos. 13–15, 19, 

24 and 46, finds that: 
 
 

Case 2:24-cv-05293-AB-E     Document 51     Filed 11/18/24     Page 1 of 7   Page ID #:611



 

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A. This Court has jurisdiction over the parties to, and the subject matter of, 

this action. 

B. Defendants have consented and the parties have stipulated to entry of the 

following Order. 

C. Defendants neither admit nor deny the allegations of the Complaint 

(except as to the Commission’s allegations concerning personal and 

subject matter jurisdiction, which Defendants admit), or that “Good 

cause” exists as stated in Paragraph E.  Nothing in this Order precludes 

Defendants from contesting the allegations or claims in the SEC’s 

Complaint. 

D. Defendants will not oppose enforcement of this Order of Preliminary 

Injunction on the ground, if any exists, that it fails to comply with Rule 

65 of the Federal Rules of Civil Procedure or any statutes or judicial 

precedent regarding preliminary injunctions, and waive any such 

objection. 

E. For purposes of this Stipulated Order, good cause exists to believe that 

(1) the SEC is likely to succeed on the merits of its claim that 

Defendants Hedonova LLC and Hedonova Advisors LLC have engaged 

in, are engaging in, are about to engage in, and will continue to engage 

in transactions, acts, practices and courses of business that constitute 

violations of Section 17(a) of the Securities Act of 1933 (“Securities 

Act”) [15 U.S.C. § 77q(a)]; Section 10(b) of the Securities Exchange Act 

of 1934 (“Exchange Act”) [15 U.S.C. § 78j(b)] and Rule 10b-5 

thereunder [17 C.F.R. § 240.10b-5]; and that Defendant Hedonova 

Advisors LLC has engaged in, is engaging in, is about to engage in, and 

will continue to engage in transactions, acts, practices and courses of 

business that constitute violations of Section 206(4) of the Investment 

Advisers Act of 1940 (“Advisers Act”) [15 U.S.C. § 80b-6(4)] and Rule 

Case 2:24-cv-05293-AB-E     Document 51     Filed 11/18/24     Page 2 of 7   Page ID #:612



 

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206(4)-8 thereunder [17 C.F.R. § 275.206(4)-8]; (2) irreparable harm 

will result in the absence of the emergency or preliminary relief; (3) the 

balance of equities tips in the SEC’s favor; and (4) an injunction is in the 

public interest. 

PRELIMINARY INJUNCTION ORDER 

I. 

IT IS HEREBY ORDERED that Defendants Hedonova LLC and Hedonova 

Advisors LLC are preliminarily enjoined from violating, directly or indirectly, 

Section 10(b) of the Securities Exchange Act of 1934 [15 U.S.C. § 78j(b)] and Rule 

10b-5 promulgated thereunder [17 C.F.R. § 240.10b-5], by using any means or 

instrumentality of interstate commerce, or of the mails, or of any facility of any 

national securities exchange, in connection with the purchase or sale of any security: 

(a) to employ any device, scheme, or artifice to defraud; 

(b) to make any untrue statement of a material fact or to omit to state a material 

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

under which they were made, not misleading; or 

(c) to engage in any act, practice, or course of business which operates or 

would operate as a fraud or deceit upon any person. 

IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that, 

as provided in Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also 

binds the following who receive actual notice of this Preliminary Injunction Order 

(“Order”) by personal service or otherwise: (a) Defendants’ officers, agents, servants, 

employees, and attorneys, and (b) other persons in active concert or participation with 

Defendants or with anyone described in (a). 

II. 

IT IS HEREBY FURTHER ORDERED that Defendants Hedonova LLC and 

Hedonova Advisors LLC are preliminarily enjoined from violating Section 17(a) of 

the Securities Act of 1933 [15 U.S.C. § 77q(a)] in the offer or sale of any security by 

Case 2:24-cv-05293-AB-E     Document 51     Filed 11/18/24     Page 3 of 7   Page ID #:613



 

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the use of any means or instruments of transportation or communication in interstate 

commerce or by use of the mails, directly or indirectly: 

(a) to employ any device, scheme, or artifice to defraud; 

(b) to obtain money or property by means of any untrue statement of a material 

fact or any omission of a material fact necessary in order to make the statements 

made, in light of the circumstances under which they were made, not misleading; or 

(c) to engage in any transaction, practice, or course of business which operates 

or would operate as a fraud or deceit upon the purchaser. 

IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that, 

as provided in Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also 

binds the following who receive actual notice of this Order by personal service or 

otherwise: (a) Defendants’ officers, agents, servants, employees, and attorneys, and 

(b) other persons in active concert or participation with Defendants or with anyone 

described in (a). 

III. 

IT IS HEREBY FURTHER ORDERED that Defendant Hedonova Advisors 

LLC is preliminarily enjoined from violating Section 206(4) of the Investment 

Advisers Act of 1940 [15 U.S.C. §§ 80b-6(4)] and Rule 206(4)-8 thereunder [17 

C.F.R. § 275.206(4)-8] while serving as an investment adviser to a pooled investment 

vehicle by the use of the mails or means and instrumentalities of interstate commerce 

or by use of the mails, directly or indirectly: 

(a) to make an untrue statement of a material fact or to omit to state a material 

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

which they were made, not misleading to any investor or prospective investor in the 

pooled investment vehicle; or 

(b) to engage in any act, practice, or course of business that is fraudulent, 

deceptive, or manipulative with respect to any investor or prospective investor in the 

pooled investment vehicle. 

Case 2:24-cv-05293-AB-E     Document 51     Filed 11/18/24     Page 4 of 7   Page ID #:614



 

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IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that, 

as provided in Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also 

binds the following who receive actual notice of this Order by personal service or 

otherwise: (a) Defendant Hedonova Advisors LLC’s officers, agents, servants, 

employees, and attorneys, and (b) other persons in active concert or participation with 

Defendant Hedonova Advisors LLC or with anyone described in (a). 

IV. 

IT IS HEREBY FURTHER ORDERED that Defendants Hedonova LLC and 

Hedonova Advisors LLC are, pending resolution of this action, prohibited from 

participating on and after the date of this Order in the issuance, purchase, offer, or 

sale of securities, including but not limited to the solicitation or receipt of money for 

any investment opportunity however described, to any investor located in the United 

States. 

IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that, 

as provided in Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also 

binds the following who receive actual notice of this Order by personal service or 

otherwise: (a) Defendants’ officers, agents, servants, employees, and attorneys, and 

(b) other persons in active concert or participation with Defendants or with anyone 

described in (a). 

V. 

IT IS HEREBY FURTHER ORDERED that Defendants Hedonova LLC and 

Hedonova Advisors LLC are, pending resolution of this action, required within 5 

business days of the issuance of this order to post in a prominent place on the 

homepage of the website located at Hedonova.io, when accessed from the United 

States, as well as on the homepage of any website subsequently created by 

Defendants that is available to investors and prospective investors located in the 

United States, and in a prominent place in the mobile application software 

Defendants have made available to investors and prospective investors located in the 

Case 2:24-cv-05293-AB-E     Document 51     Filed 11/18/24     Page 5 of 7   Page ID #:615



 

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United States: 

(a) the following statement: “On June 24, 2024, the United States Securities 

and Exchange Commission filed a Complaint in the United States District Court for 

the Central District of California alleging that Hedonova LLC and Hedonova 

Advisors LLC (“Defendants”) violated certain anti-fraud provisions of the federal 

securities laws.  On August 14, 2024, Defendants filed an Amended Answer denying 

in relevant part the allegations of the Complaint.”; 

(b) a hyperlink to a copy of the Commission’s Complaint (Dkt. 1);  

(c) a hyperlink to a copy of Defendants’ Amended Answer to the Complaint 

(Dkt. 45); and 

(d) a hyperlink to a copy of this Order of Preliminary Injunction (Dkt. __). 

IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that, 

as provided in Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also 

binds the following who receive actual notice of this Order by personal service or 

otherwise: (a) Defendants’ officers, agents, servants, employees, and attorneys, and 

(b) other persons in active concert or participation with Defendants or with anyone 

described in (a). 

VI. 

IT IS FURTHER ORDERED that Defendant Hedonova Advisors LLC must 

file an amended correct and accurate Form ADV with the Commission within 7 

business days of the issuance of this order.1  

IT IS HEREBY FURTHER ORDERED, ADJUDGED, AND DECREED that, 

as provided in Federal Rule of Civil Procedure 65(d)(2), the foregoing paragraph also 

binds the following who receive actual notice of this Order by personal service or 

otherwise: (a) Defendant Hedonova Advisors LLC’s officers, agents, servants, 

 
1 Any revisions to the Form ADV may not be construed as an admission that prior 
statements as alleged in the Complaint were false or misleading.  

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employees, and attorneys, and (b) other persons in active concert or participation with 

Defendant Hedonova Advisors LLC or with anyone described in (a). 

VII. 

IT IS HEREBY FURTHER ORDERED that: 

A. The Court shall retain jurisdiction over this action for all purposes. 

B. Pursuant to Federal Rule of Civil Procedure 65(c), no security is 

required of the Commission.  

C. This Preliminary Injunction shall remain in effect until entry of Final 

Judgment in, or other final disposition of, this action, or further Order of this Court.  

  

IT IS SO ORDERED. 

 

Dated: November 18, 2024 _______________________________________                               
HONORABLE ANDRÉ BIROTTE JR. 
UNITED STATES DISTRICT COURT JUDGE 

 

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