Defendant Alleged to Have Illegally Tipped Evades Service for Years
Some defendants believe that they can avoid liability by refusing service and then ducking the delivery of the papers. Not so. The Commission has more than sufficient avenues to secure effective service of process on those who believe that if they only evade service long enough the agency will ultimately give up. A good example is SEC v. Watson, Civil Action No. 1:21cv-05923 (S.D.N.Y. Decision filed June 30, 2025).
Named as defendants in the action are: Eric J. Watson, Oliver-Barret Lindsay and Gannon Giguiere. Mr. Watson is alleged to have violated the securities laws in connection with his role as the controlling shareholder of Long Island Iced Tea Corp. Specifically, he is alleged to have participated in an insider trading scheme by tipping a business associated regarding the then forth coming announce that the firm was about to pivot its business.
Prior to being served with process, the Commission made repeated efforts to serve Mr. Watson with its complaint. Mr. Watson, a citizen of New Zealand, had been residing in London. While Mr. Watson was apparently told in July, 2021 about the filing of a complaint against him by the Commission, he was not served despite repeated efforts by the Commission. Those included two made through the Hague Convention at his purported address in Ibiza, Spain. Ultimately, the agency requested that a court permit service by publication. The request was granted.
Following the completion of the process, Defendant was served. He defaulted. The Commission obtained a default judgment in early February 2023.
In mid-June, 2024 Mr. Watson emailed the staff, advising that he would appear in court pro se. On July 1, 2024, after having a default judgment previously granted against him set aside and his motion to dismiss rejected Defendant appeared and filed a counterclaim against the agency. The court rejected Defendant’s claims in an opinion issued on June 30, 2025. See Lit. Rel. No. 26350 (July 15, 2025). Today the saga continues.