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Treasure Coast Bullion Group Solicitor’s Motion To Dismiss Lawsuit Denied

A favorable court ruling on behalf of a client who suffered losses in a leveraged precious metals investment scheme will proceed against the solicitor. On January 4, 2023, the United States District Court for the Northern District of California denied a motion to Dismiss for Lack of Personal Jurisdiction filed by the Defendant, a solicitor for Treasure Coast Bullion Group.A favorable court ruling on behalf of a client who suffered losses in a leveraged precious metals investment scheme will proceed against the solicitor. On January 4, 2023, the United States District Court for the Northern District of California denied a motion to Dismiss for Lack of Personal Jurisdiction filed by the Defendant, a solicitor for Treasure Coast Bullion Group.

The Court described the “Background” of the case as plead in the complaint as follows:

  • In February 2019, Plaintiff attended a two and a half day in-person training seminar on investing options in San Jose, California provided by Interactive Trader and taught by Defendant Broberg. Plaintiff alleges that Broberg presented himself as an expert in investing and advised his students about favorable investments. After the seminar, Broberg corresponded by email with his California seminar students and continued to provide investment advice.
  • Plaintiff developed a relationship of trust and confidence with Broberg regarding investment advice, and on May 7, 2020, Broberg emailed Page recommending she invest in a precious metals investment program with Treasure Coast Bullion Group with the potential for high returns. Broberg sent Plaintiff other emails and texts regarding silver and the leveraged precious metals program. Plaintiff alleges Broberg told her he personally vetted Treasure Coast and was certain it was a safe investment opportunity.
  • Plaintiff alleges that Broberg failed to disclose that Treasure Coast representatives had been fined or sanctioned for “boiler room-type schemes.” Plaintiff alleges that Broberg failed to disclose that he would receive a payment for referring her to Treasure Coast. Plaintiff also alleges that Broberg failed to disclose and omitted the material risks of the investment despite knowing that the representations about the investment were false.
  • Based on Broberg’s expertise, his recommendation, and the relationship of trust the two shared, Plaintiff decided to pursue the investment and contacted Broberg’s broker, Matthew Kehoe at Treasure Coast to invest. In May 2020, Plaintiff invested her retirement funds, in excess of $3 million, in Treasure Coast’s precious metals program. Plaintiff liquidated her Treasure Coast account in May 2022. Although the price of silver increased, Plaintiff lost $2.7 million in markups, fees, interests, and commissions and liquidated for about $400,000.00.
  • As a result of her investment, Plaintiff has lost most of her life’s savings and owes significant taxes for converting her retirement accounts, which has put her ownership and possession of her home at risk. Plaintiff brings claims for constructive fraud, unjust enrichment, negligent misrepresentation, and fraud.

In denying the Treasure Coast Bullion solicitor’s Motion, the Court found:

  • The Court finds Broberg’s intentional acts were “expressly aimed” at California. Broberg himself created contacts with California. He taught an investment training seminar in California 15 times over 5 years, including the seminar in 2019 where he met Plaintiff. The record shows that Broberg specifically reached out to his California seminar students encouraging them to contact him for information about new investment opportunities. Broberg also sent numerous emails and texts to Plaintiff while she was in California regarding the leveraged precious metals investment opportunity. Thus, Broberg’s relationship with California arose out of contacts he himself made with the forum state and extended beyond contacts just with Plaintiff.
  • Thus, the Court concludes Broberg’s contacts with California are not “random, fortuitous, or attenuated.” He expressly aimed his contacts at California by teaching numerous investment training seminars there, sending email communications targeted exclusively to his California students, offering his advice and expertise regarding investment opportunities, and sending numerous emails and texts to Plaintiff regarding the precious metals investment program, including referring her to his broker at Treasure Coast.

Some internal citations and references were removed from these excerpts.

Aaron Cohen, counsel for the Plaintiff comments “this is an important step forward to holding a solicitor responsible for fraudulent statements and recommending an alleged unregistered investor advisor”.

Scott Silver, co-counsel for the Plaintiff added “unfortunately, we have seen a rise in cases against precious metal firms for selling a leveraged precious metals programs based on false pretenses and a lack of registration with the CFTC or any other regulatory agency.”

Precious Metal Fraud Attorneys

Our attorneys represent victims of securities and investment fraud. If you suffered losses and would like a confidential consultation with an investment fraud attorney with passion and experience advocating for aggrieved investors, call Silver Law Group toll free at (800) 975-4345 or email ssilver@silverlaw.com.

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