On June 24, 2022, the federal district court in Chicago approved an unusual settlement in which the US Securities and Exchange Commission (SEC) voluntarily agreed to drop all of its allegations of fraud against Latham client Gary S. Winemaster, the founder and former CEO of Power Solutions International, Inc. as part of the resolution of its action against Mr. Winemaster. The SEC and Mr. Winemaster resolved the two remaining counts on a no-admit, no-deny basis. The settlement comes on the heels of Mr. Winemaster’s full acquittal, in September 2021, after a trial on related criminal charges brought by the US Department of Justice (DOJ). The SEC settlement officially terminates the alleged fraud cases that the DOJ and SEC filed against Mr. Winemaster in July 2019.
“The public now knows what we’ve known from the start: Gary is innocent of the fraud charges brought against him. The evidence presented at trial gutted the government’s theory of fraud, a federal court acquitted him of all charges, and now the SEC has dropped its fraud charges as well. We appreciate the SEC’s willingness to walk away from its original theory of the case after considering the trial record,” said John Sikora of Latham & Watkins, lead counsel for Mr. Winemaster in the SEC’s matter.
“I am relieved to have been completely cleared of the baseless allegations of fraud. I look forward to pursuing new opportunities in the industry I had stepped away from while resolving these matters,” Mr. Winemaster said.
Following today’s settlement, there are no pending charges against Mr. Winemaster for any actions related to his work at PSI. The settlement imposes no restrictions on Mr. Winemaster’s ability to work in any capacity at any public company.
In addition to Mr. Sikora, the Latham team that represented Mr. Winemaster at trial and in the SEC matter included partners Sean Berkowitz, Eric Swibel, and Heather Waller, and associates Jack McNeily, Adam Rosenbloom, Kirsten Lee, Linda Qiu, and Sydney Black.