Litigation Release No. 25493 / September 1, 2022
Securities and Exchange Commission v. Cronin and Joseph, No. 22-mc-248 (S.D.N.Y filed September 1, 2022)
The Securities and Exchange Commission announced that it has filed an action against Curtis Wayne Cronin (“Cronin”) and John Joseph (“Joseph”), both Managing Partners of Broadway Strategic Return Fund, LP (the “Fund”), a fund that invests in securities related to theatrical productions, seeking an order directing them to comply with investigative subpoenas for testimony and documents.
According to the SEC’s filing in U.S. District Court for the Southern District of New York, the SEC is investigating whether Cronin and Joseph or others violated the federal securities laws by, among other things, making materially misleading statements to existing or prospective investors concerning the valuation of the Fund assets, and whether, after the SEC had begun a formal investigation of the Fund, they falsely represented in due diligence questionnaires disseminated to actual or prospective investors that there have not been any investigations of the Fund or the Fund’s general partner. As stated in the filing, SEC staff served both Cronin and Joseph with investigative subpoenas requiring the production of certain documents and compelling their testimony. According to the filing, however, and despite numerous attempts to secure compliances with the subpoenas, Cronin and Joseph have refused to produce documents and failed to comply with the testimonial obligations.
The SEC’s application seeks an order from the court directing Cronin and Joseph to show cause why the court should not compel them to appear for testimony and produce documents as required by the subpoenas. The application further seeks an order from the court, following its ruling on the order to show cause, directing Cronin and Joseph to comply fully with the subpoenas. The SEC is continuing its fact-finding investigation and, to date, has not concluded that any individual or entity has violated the federal securities laws.