John O'Quinn and Wes Christian, scored a big victory in California in the NFI shareholders' suit against the prime brokers alleging naked short selling of that company. The defendants motion to remand that case to Federal Court was denied.

http://www.thesanitycheck.com/Portal...

Had this case been remanded to Federal Court, the SEC would have been able to come to the defense of the defendants, and argued that all that occurred was under the watchful eye of the SEC. However, since the complaint was not based on the violation of federal securities law, but only on the violation of State securities statutory law, the court ruled that the State did have jurisdiction and remanded the case back to the court to be heard.

The case can now move into the discovery phase. That means all the trading records, the true size of the naked short position in the company, chat board basher IDs, any indication of a collusive scheme to drive down the price of the stock, ALL the evidence is now on the table.

This sets an important legal precident for the Nanopierce, et al, case against the DTCC in Nevada, because the same issues were being argued. Nanopierce also based its complaint against the DTCC entirely on the violation of State securities statutory law. The case is currently under review in the Nevada Appeals Court. If the important legal precident is followed, that has now been set in the California NFI suit, it is very probable that the Nanopierce, et al, v. DTCC case may soon be sent back to the lower court to proceed.

-zties