8:15-cv-00317-LES-FG3 Doc # 25 Filed: 10/13/15 Page 1 of 12 - Page ID # 182

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UNITED STATES DISTRICT COURTlJ.S. msuuc~_Bc~isKA

FOR THE DISTRICT OF NEBRASKl\\STRICT Of ~t .,
COR CLEARING, LLC, a Delaware limited
Liability company,

2Gl5 OCl \ 3 Pt\ \:OS

Plaintiff,
vs.
CALISSIO RESOURCES GROUP, INC.,
a Nevada corporation; ADAM CARTER,
an individual; SIGNATURE STOCK
TRANSFER, INC., a Texas corporation;
and DOES 1-50

Case No. 8:15-cv-317

BENJAMIN RILEY'S
EXPEDITED MOTION FOR
LEAVE TO FILE
AMICUS BRIEF

Defendants.

Benjamin Riley, shareholder of Calissio Resources Group, Inc. which is a publicly traded
corporation (hereinafter referred to as CRGP) respectfully moves in his individual capacity, pro
se, pursuant to the Court's inherent authority and sole discretion, to file a brief as amicus curiae
arguing why a temporary receiver should not be appointed for the sole purpose of directing the
DTCC to perform certain post payable adjustments.

I.

DISTRICT COURTS HAVE AUTHORITY TO ACCEPT AMICUS BRIEFS

A District Court has broad inherent authority to permit or deny an appearance as amicus curiae

in a given case. UnitedStatesv.Ahmed, 788F.Supp.196, 198n.1 (S.D.N.Y.1992),affd,980F.2d

161 (2d Cir.1992). The amicus privilege "rests in the discretion of the court which may grant or
refuse leave according as it deems the proffered information timely, useful, or otherwise." Leigh

v. Engle, 535 F.Supp. 418, 420 (N.D.Ill.1982). Federal district courts possess the inherent authority
to accept amicus briefs. In re Bayshore Ford Truck Sales, Inc., 471 F.3d 1233, 1249 n.34 (11th
Cir. 2006) ("[D]istrict courts possess the inherent authority to appoint 'friends of the court' to

RECEIVED
OCT 1 3 2015

U.S. DIS.COURT
i"'ll . -"

8:15-cv-00317-LES-FG3 Doc # 25 Filed: 10/13/15 Page 2 of 12 - Page ID # 183

assist in their proceedings."); Jin v. Ministry of State Security, 557 F. Supp. 2d 131, 136 (D.D.C.
2008) ("district courts have inherent authority to appoint or deny amici which is derived from Rule
29 of the Federal Rules of Appellate Procedure"); United States v. Davis, 180 F. Supp. 2d 797,
800 (E.D. La. 2001) (noting that district courts have authority to permit the filing of amicus briefs).
The role of amici is to assist the court "in cases of general public interest by making suggestions
to the court, by providing supplementary assistance to existing counsel, and by insuring a complete
and plenary presentation of difficult issues so that the court may reach a proper decision." Newark
Branch, N.A.A. C.P. v. Town of Harrison, N.J., 940 F.2d 792, 808 (3d Cir. 1991). This authority
supports the Court's exercise of its discretion to accept Mr. Riley, CRGP shareholder's amicus
brief.

II.

BENJAMIN RILEY'S PROPOSED BRIEF PROVIDES IMPERATIVE FACTS AND LAW

NOT YET PROVIDED TO TIDS COURT AND THAT ARE ABSOLUTELY NECESSARY
FOR THE COURT TO CONSIDER IN DETERMINING WHETHER OR NOT TO
APPOINT A RECIEVER
First, COR'S pleadings and statements to this honorable court have failed to mention the
fact that FINRA deemed the shareholder dividend to be a "special dividend." Special dividends
are governed by nasdaq Rule 11140(b)(2) which states: "In respect to cash dividends or
distributions, stock dividends and/or splits, and the distribution of warrants, which are 25% or
greater of the value of the subject security, the ex-dividend date shall be the first business day
following the payable date." With respect to "special dividends'', and contrary to COR Clearing's
viewpoint, the record date is irrelevant. Instead, the only date that matters regarding who is eligible
or who is not eligible to receive the dividend, is the ex-dividend date. Consequently, although
millions of shares were converted after the record date, all stockholders who held shares in CRGP
until the ex-dividend date were eligible to receive the dividend. As a matter of fact, the special
cash dividend was approved by FINRA, cleared through the DTCC, and settled into shareholder

8:15-cv-00317-LES-FG3 Doc # 25 Filed: 10/13/15 Page 3 of 12 - Page ID # 184

accounts. Also, COR itself admits that most of the "inelliglbe' shares were bought back by CRGP.
Therefore, COR should not be seeking recourse against innocent shareholders. They are not a part
of the transaction which resulted from COR's own clients converting debt to equity and thus
flooding the market with newly issued shares. COR is attempting to shift their risk of loss onto
innocent shareholders when in reality, the shareholders are separate and distinct from the
transaction resulting in COR's monetary loss.
Second, the appointment of a receiver will have a detrimental impact on shareholders who
are ultimately the end users burdened by the appointment of a receiver. Once this case was filed
against CRGP, a FINRA investigation halted the stock and the ticker went from being traded on
the OTC market to the grey market. The grey market is synonymous to a death sentence for
shareholders. Once moved to the grey market, the value of CRGP went down to being practically
worthless. As a result, shareholders of CRGP own worthless stock and lost their entire investment.
Moreover, numerous shareholders reinvested their cash dividend back into the corporation.
As a result, these shareholders lost not only their principle investment, but also the dividend
that they received. If a receiver is appointed, brokers will be pull this money out of
shareholder accounts and if the cash is not there, margin calls will be issued. The appointment
of a receiver will cause more harm than good. Many shareholders, will be hit with margin calls
that they cannot afford to pay back because they either reinvested the dividend or they spent cash
on other investments and misc items. Why should shareholders be punished with margin calls and
return of dividend funds when they received the dividend in good faith without reason to believe
that it would be taken back from them? COR clearing stated that the appointment of a receiver is
the only way to reach the pockets of CRGP. On the contrary, the appointment of a receiver will
reach the pockets of shareholders who have already been beaten with loss of investment.

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8:15-cv-00317-LES-FG3 Doc # 25 Filed: 10/13/15 Page 4 of 12 - Page ID # 185

Third, the shareholders of CRGP are unrepresented in this case and the notice to be heard
procedure proposed by COR will not allow shareholders of CRGP (the ultimate individuals bearing
the burden of a receiver) the opportunity to be heard, it will instead, allow brokerage firms the
opportunity to be heard.

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8:15-cv-00317-LES-FG3 Doc # 25 Filed: 10/13/15 Page 5 of 12 - Page ID # 186

CERTIFICATE OF SERVICE
I hereby certify that on October 9, 2015, I filed the foregoing (1) Motion for Leave to File
Amicus Brief and 2) Proposed Amicus Brief by U.S. Mail. A copy was sent by U.S. Mail to all
parties of record:
Andrew G. Smith
WINSTON, STRAWN LAW FIRM LOS ANGELES
333 South Grand Avenue
Suite 3800
Los Angeles, CA 90071-1543
(213) 615-1700
Fax: (213) 615-1750
agsmith@winston.com
PROHACVICE
ATIORNEY TO BE NOTICED
Saul S. Rostamian
WINSTON, STRAWN LAW FIRM - LOS
ANGELES
333 South Grand Avenue
Suite 3800
Los Angeles, CA 90071-1543
(213) 615-1700
Fax: (213) 615-1750
srostamian@winston.com
PROHACVICE
ATIORNEY TO BE NOTICED
David L. Aronoff
WINSTON, STRAWN LAW FIRM LOS ANGELES
333 South Grand Avenue
Suite 3800
Los Angeles, CA 90071-1543
(213) 615-1700
Fax: (213) 615-1750
daronoff@winston.com
PROHACVICE
ATIORNEY TO BE NOTICED

Dated: October 9, 2015

Michael T. Hilgers
GOBER, HILGERS LAW FIRM OMAHA
14301 FNB Parkway
Suite 100
Omaha, NE 68154
(402) 218-2106
Fax: (877) 437-5755
mhilgers@goberhilgers.com
ATIORNEY TO BE NOTICED
Carrie S. Dolton
GOBER, HILGERS LAW FIRM OMAHA
14301 FNB Parkway
Suite 100
Omaha, NE 68154
(402) 218-2106
Fax: (877) 437-5755
cdolton@goberhilgers.com
ATIORNEY TO BE NOTICED

Calissio Resources Group, Inc.

Clark Agency, LLC
5915 Edmond Ste 125
Las Vegas, NV 89118
Jason Bogutski
Signature Stock Transfer, Inc.
2632 Coachlight Ct.
Plano, TX 7 5093

Benjamin Riley
Pro Se Litigant Shareholder of CRGP

8:15-cv-00317-LES-FG3 Doc # 25 Filed: 10/13/15 Page 6 of 12 - Page ID # 187

UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF NEBRASKA
COR CLEARING, LLC, a Delaware limited )
Liability company,
)
Plaintiff,
vs.
CALISSIO RESOURCES GROUP, INC.,
a Nevada corporation; ADAM CARTER,
an individual; SIGNATURE STOCK
TRANSFER, INC., a Texas corporation;
and DOES 1-50
Defendants.

)
)
)
)
)
)
)
)
)
)
)
)
)

Case No. 8:15-cv-317

PRO SE LITIGANT AND CRGP

SHAREHOLDER BENJAMIN
RILEY'S AMICUS CURIAE BRIEF IN
OPPOSITION TO PLAINTIFF'S
MOTION TO APPOINT RECIEVER

Benjamin Riley is a shareholder of Calissio Resources Group, Inc. which is a publicly

traded corporation (hereinafter referred to as CRGP). Mr. Riley opposes plaintiffs motion to
appoint a receiver and is litigating in his individual capacity, prose.
A temporary receiver should not be appointed for the sole purpose of directing the DTCC
to perform certain post payable adjustments because there are facts and law not yet provided to
this court which are necessary for the court to take into consideration in determining whether or
not to appoint a receiver. This honorable court appointing a receiver will result in a miscarriage of
justice to innocent dividend recipient shareholders who are unrepresented in this case.

I.

ARGUMENT
A.

Plaintiff Failed to Disclose the Special Dividend Rule to the Court and Failed to
Provide Legal Support for the Assertion that Shares Issued After the Record
Were Ineligible for the Dividend
COR'S pleadings and statements to this honorable court have failed to mention the fact

that FINRA deemed the shareholder dividend to be a "special dividend." Although CRGP may not

8:15-cv-00317-LES-FG3 Doc # 25 Filed: 10/13/15 Page 7 of 12 - Page ID # 188

have intended for the dividend to be a special dividend, it was classified as such by FINRA. Special
dividends are governed by Nasdaq Rule l l l 40(b)(2) which states: "In respect to cash dividends or
distributions, stock dividends and/or splits, and the distribution of warrants, which are 25% or
greater of the value of the subject security, the ex-dividend date shall be the first business day
following the payable date." With respect to "special dividends", and contrary to COR Clearing's
viewpoint, the record date is irrelevant. Instead, the only date that matters regarding who is eligible
or who is not eligible to receive the dividend, is the ex-dividend date. Consequently, although
millions of shares were converted after the record date, all stockholders who held shares in CRGP
until the ex-dividend date were eligible to receive the dividend. As a matter of fact, the special
cash dividend was approved by FINRA, cleared through the DTCC, and settled into shareholder
accounts. Even if plaintiff is correct in its assertion that shares issued after 6/30/15 were not
dividend eligible, COR itself admits that most of the "ineligible' shares were bought back by
CRGP. This would mean that CRGP shareholders held dividend eligible shares and were
entitled to the dividend and the ineligible dividends were in the pockets of CRGP itself and
not the individual shareholders. Therefore, COR should not be seeking recourse against innocent
shareholders because they are not a part of the transaction which resulted from CO R's own
clients converting debt to equity and thus flooding the market with newly issued shares.
Plaintiff stated to the court that some brokers are holding the dividend funds for their
clients. This is misleading to the court because the only broker known to be holding/freezing
the dividend funds is E-Trade Financial. Numerous CRGP shareholders received the dividend
through other brokerage accounts such as Scottrade, TD Ameritrade, etc. Moreover, E-Trade
Financial did not place the hold on client's funds until a few weeks after the dividend was
approved by FINRA, processed by DTCC, and settled into client accounts. Since E-Trade is

8:15-cv-00317-LES-FG3 Doc # 25 Filed: 10/13/15 Page 8 of 12 - Page ID # 189

the only broker holding the funds and since E-Trade dido 't impose the hold until weeks after
being paid to clients, a huge miscarriage of justice will occur to CRGP shareholders if a
receiver is appointed for the purpose of directing DTCC to make post payable adjustments.
This is so, because shareholders received the dividend in good faith without reason to know
that it was susceptible to being reversed.
B.

The Appointment of a Receiver Will Have a Detrimental Impact on the Innocent

Shareholders of CRGP
The appointment of a receiver will have a detrimental impact on innocent shareholders who

are ultimately the end users burdened by the appointment of a receiver. Plaintiff COR is a
sophisticated party who clears transactions in the OTC stock market. As a clearing firm in the OTC
markets, COR assumes many risks involved of operating in the clearing industry and with dealing
with clients who operate in an unregulated industry (Over the counter stocks). In this case, COR
is attempting to shift their risk of loss to innocent shareholders who received a dividend in good
faith and without reason to know that a reversal would possibly occur through the appointment of
a receiver. Shareholders will ultimately be burdened by the appointment of a receiver because the
receiver will request post payable adjustments to the DTCC, and the DTCC will pull the money
from the brokerage firms who will then pull the money from their clients who are CRGP current
and former shareholders. Once this case was filed against CRGP, a FINRA investigation halted
the stock and the ticker went from being traded on the OTC market to the grey market. The grey
market is like a death sentence for shareholders. Once moved to the grey market, the value of
CRGP went down to being practically worthless. As a result, shareholders of CRGP own worthless
stock and lost most of their investment. Moreover, numerous shareholders reinvested their cash
dividend back into the corporation. As a result, these shareholders lost not only their principle

investment, but also the dividend that they received. If a receiver is appointed, brokers will be

'

8:15-cv-00317-LES-FG3 Doc # 25 Filed: 10/13/15 Page 9 of 12 - Page ID # 190

pull this money out of shareholder accounts and if the cash is not there, (as is this case for most
CRGP dividend recipient shareholders) margin calls will be issued, credit scores will be ruined,
and disaster will occur between brokers and broker's clients. Consequently, the appointment of

a receiver will cause more harm than good. Many shareholders, will be hit with margin calls
that they cannot afford to pay back because they either reinvested the dividend or they spent the
cash on other investments and misc items. Why should shareholders be punished with margin calls
and return of dividend funds when they received the dividend in good faith without reason to
believe that it would be taken back from them? CRGP shareholders had no reason to believe

that their dividend that they received in their brokerage accounts were susceptible to being
reversed. They received the dividend in good faith and should not be held liable for CRGP's
actions. COR clearing stated that the appointment of a receiver is the only way to reach the pockets
of CRGP. On the contrary, the appointment of a receiver will not reach the pockets of CRGP, it
will reach the pockets of shareholders who have already been beaten with losses of their entire
investment.

C.

Plaintiff's Motion to Appoint Receiver Serves the Purpose of Reaching the

Pockets of Innocent Shareholders, which is Unprecedented

There are no cases on point attempting to disregard the corporate form to go after the pockets
of shareholders of a publicly traded corporation who innocently received a dividend in good faith
and without knowledge of fraudulent conduct. The only cases on point, involve the corporate form
being disregarded where the shareholders were actively involved in the fraudulent conduct and
knew about the fraudulent conduct. No case has reached the pocket of an innocent shareholder

of a publicly traded corporation who received a dividend in good faith. Moreover, it has yet
to be proven that CRGP "individual" shareholders are in possession of plaintiffs money. As a

..

8:15-cv-00317-LES-FG3 Doc # 25 Filed: 10/13/15 Page 10 of 12 - Page ID # 191

result, appointment of a receiver may result in COR Clearing being unjustly enriched with

funds that belong to shareholders.

D.

Notice to be Heard Procedure Proposed by COR Will Allow Brokerage Firms the
Opportunity to be Heard but Not Shareholders ofCRGP, Who Are the Ultimate
Individuals Bearing the Burden of the Appointment of a Receiver
The shareholders of CROP are unrepresented in this case and the notice to be heard

procedure proposed by COR will not allow shareholders of CROP (the ultimate individuals bearing
the burden of a receiver) the opportunity to be heard. Instead, it will allow brokerage firms an
opportunity to be heard. However, since brokerage firms will issue margin calls and hold their
clients responsible for the dividend funds, the brokerage firm's clients (CROP shareholders)
deserved to be heard in their own individual capacities. Especially since their pockets will be
reached.

II.

CONCLUSION
The appointment of a receiver will result in a huge miscarriage of justice. Accordingly,
for the reasons above, the Court should deny COR Clearing's Motion for Order Appointing
Limited Purpose Receiver and should not appoint as receiver Ronald F. Greenspan, Esq. for the
limited purpose of instructing DTCC to make post-payable adjustments in accordance with
DTCC's policies and procedures.

..

8:15-cv-00317-LES-FG3 Doc # 25 Filed: 10/13/15 Page 11 of 12 - Page ID # 192

CERTIFICATE OF SERVICE
I hereby certify that on October 9, 2015, I filed the foregoing (I) Motion for Leave to File
Amicus Brief and 2) Proposed Amicus Brief by U.S. Mail. A copy was sent by U.S. Mail to all
parties of record:
Andrew G. Smith
WINSTON, STRAWN LAW FIRM LOS ANGELES
333 South Grand Avenue
Suite 3800
Los Angeles, CA 90071-1543
(213) 615-1700
Fax: (213) 615-1750
agsmith@winston.com
PROHACVICE
ATTORNEY TO BE NOTICED
Saul S. Rostamian
WINSTON, STRAWN LAW FIRM - LOS
ANGELES
333 South Grand Avenue
Suite 3800
Los Angeles, CA 90071-1543
(213)615-1700
Fax: (213) 615-1750
srostamian@winston.com
PROHACVICE
ATTORNEY TO BE NOTICED
David L. Aronoff
WINSTON, STRAWN LAW FIRM LOS ANGELES
333 South Grand Avenue
Suite 3800
Los Angeles, CA 90071-1543
(213) 615-1700
Fax: (213) 615-1750
daronoff@winston.com
PROHACVICE
ATTORNEY TO BE NOTICED

Michael T. Hilgers
GOBER, HILGERS LAW FIRM OMAHA
14301 FNB Parkway
Suite 100
Omaha, NE 68154
(402) 218-2106
Fax: (877) 437-5755
mhilgers@goberhilgers.com
ATTORNEY TO BE NOTICED
Carrie S. Dolton
GOBER, HILGERS LAW FIRM OMAHA
14301 FNB Parkway
Suite 100
Omaha, NE 68154
(402) 218-2106
Fax: (877) 437-5755
cdolton@goberhilgers.com
ATTORNEY TO BE NOTICED

Calissio Resources Group, Inc.

Clark Agency, LLC
5915 Edmond Ste 125
Las Vegas, NV 89118
Jason Bogutski
Signature Stock Transfer, Inc.
2632 Coachlight Ct.
Plano, TX 75093

~J?~
Dated: October 9, 2015

Benjamin Riley
Pro Se Litigant Shareholder of CRGP

8:15-cv-00317-LES-FG3 Doc # 25 Filed: 10/13/15 Page 12 of 12 - Page ID # 193

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