SEC v. Maxwell Fair Fund

On March 27, 2018, the Securities and Exchange Commission (the “SEC”) issued an Order Instituting Cease-and-Desist Proceedings Pursuant to Section 8A of the Securities Act of 1933 and Section 21C of the Securities Exchange Act of 1934, Making Findings, and Imposing Remedial Sanctions and a Cease-and-Desist Order (the “Order”) against the Respondents. In the Order, the SEC found that, from December 2011 through January 2013, Maxwell, a California-based company that develops, manufactures, and markets energy storage and power delivery products, through its former officers Andrews, Schramm, and DeWitt, engaged in an accounting fraud scheme that improperly recognized over $19 million in revenue from future quarters in violation of U.S. Generally Accepted Accounting Principles. The SEC ordered Maxwell, Andrews, and DeWitt to pay civil money penalties of $2.8 million, $50,000, and $20,000, respectively; and ordered Schramm to disgorge $33,878 and pay prejudgment interest of $6,113 and a civil money penalty of $40,000. Pursuant to Section 308(a) of the Sarbanes-Oxley Act of 2002, as amended, the SEC established a Fair Fund so that the civil money penalties could be distributed with disgorgement and prejudgment interest (the “Maxwell Fair Fund”). The Respondents have since paid $2,937,491 with the remainder to be paid by Andrews by March 19, 2019. Any additional funds timely received will be added to the Maxwell Fair Fund for disbursement to investors pursuant to the Plan.

The Maxwell Fair Fund is deposited in an interest-bearing account at the United States Treasury Department’s Bureau of the Fiscal Service. The assets of the Maxwell Fair Fund are subject to the continuing jurisdiction and control of the SEC. The SEC approved the Plan on November 5, 2018, and the SEC retains jurisdiction over implementation of the Plan.

If you purchased shares of Maxwell common stock during the period from February 26, 2012 through March 19, 2013, inclusive, are not an Excluded Party as defined in the Plan, and suffered a loss according to the Plan, you may be eligible for a Distribution Payment from the Maxwell Fair Fund.

Excluded Parties are: Maxwell Technologies, Inc., Van M. Andrews, David J. Schramm, James W. DeWitt, Jr. (collectively, the “Respondents”) and any assigns, heirs, spouses, parents, dependents or controlled entities of any of the Respondents and the Fund Administrator, its employees, and those persons assisting the Fund Administrator in its role as Fund Administrator.

Potential Claimants will be identified, and claims evaluated based on information previously obtained by the Fund Administrator in connection with the related Class Action, In re Maxwell Technologies, Inc. Securities Litigation, Case No. 3:13-cv-00580-BEN-RBB (S.D. Cal.) and not through a claims process.