United States Securities and Exchange Commission Plaintiff-Appellee
Gary Albert Collyard; Collyard Group, LLC Defendants Paul D. Crawford; Crawford Capital Corp. Defendants-Appellants Ronald Musich; Joshua J. Singer; Michael B. Spadino; Marketing Concepts, Inc.; Christopher C. Weides Defendants
Submitted: November 16, 2016
from United States District Court for the District of
Minnesota - Minneapolis
BENTON and SHEPHERD, Circuit Judges, and STRAND,  District
BENTON, Circuit Judge.
Securities and Exchange Commission sued Paul D. Crawford and
Crawford Capital Corporation (collectively
"Crawford") for acting as unregistered brokers in
violation of § 15(a) of the Securities Exchange Act of
1934, 15 U.S.C. § 78o(a). The district court
granted the SEC summary judgment, permanently enjoined
Crawford, and ordered disgorgement. Crawford appeals, arguing
that he qualifies for a "finder exception" to
broker registration, and that a statute of limitations bars
the injunction and disgorgement. Having jurisdiction under 28
U.S.C. § 1291, this court affirms in part and vacates in
Crawford has a long history of working in investment. He
registered as a securities broker in 1969 and was associated
with registered broker-dealers for decades. He founded
Crawford Capital Corporation in 1990. Its business is helping
raise capital for early-stage companies. In 1996, his license
was suspended for selling unregistered securities. He never
2003, Crawford learned about a company called Bixby Energy
Systems. He invested about $20, 000 in Bixby. Starting around
February 2004, Crawford agreed with a third party to refer
investors to Bixby in exchange for a 3% commission on
referred investments. At some point in 2004 or 2005, Crawford
agreed directly with Bixby to refer investors in exchange for
a 10% fee for referred investments. Crawford was never a
February 2004 and November 2006, Crawford worked to connect
investors with Bixby. He invited Crawford Capital clients to
Bixby presentations, emailed them suggesting they invest in
Bixby, predicted success for Bixby, advised clients on tax
credits, helped at least one client complete a Bixby
subscription agreement, told clients he could negotiate Bixby
stock prices, and told at least one client he could arrange a
Bixby-related credit-line deal. Crawford received $240, 000
from Bixby, 10% of his referred investments.
point between 2004 and 2006 were Crawford or Crawford Capital
December 2011, the SEC sued Crawford and Crawford Capital,
alleging violations of Securities Exchange Act § 15(a)
by acting as unregistered brokers and seeking a permanent
injunction and disgorgement. Crawford argued he was not a
broker but a "finder." He also argued that a
statute of limitations barred any disgorgement or injunction.
The district court rejected Crawford's arguments,
granting summary judgment to the SEC, ordering disgorgement
of the $240, 000, and permanently enjoining Crawford from
violating § 15(a). Crawford appeals.
argues this action is time-barred: "Except as otherwise
provided by Act of Congress, an action, suit or proceeding
for the enforcement of any civil fine, penalty, or
forfeiture, pecuniary or otherwise, shall not be
entertained unless commenced within five years from the date
when the claim first accrued . . . ." 28 U.S.C. §
2462 (emphasis added). Crawford contends § 2462 bars the
SEC from seeking disgorgement and an injunction.
to the SEC's complaint, Crawford acted as an unregistered
broker between February 2004 and November 2006. The SEC sued
in December 2011, more than five years after November 2006.
If § 2462 applies, it bars this suit. See Gabelli v.
SEC, 133 S.Ct. 1216, 1220, 1224 (2013) (holding, in SEC
enforcement action, that claim "accrued" under
§ 2462 when allegedly unlawful conduct occurred).
district court found § 2462 does not apply to suits for
disgorgement and injunctive relief. This court reviews de
novo. Smithrud v. City ...