The U.S. Securities and Exchange Commission (SEC) has filed fraud charges against 3D imaging device developer Imaging3 and its founder and chief executive Dean Janes.
The complaint, filed in the U.S. District Court for the Central District of California, charges Imaging3 and Janes with misleading shareholders about the U.S. Food and Drug Administration (FDA)'s view of the company's medical device, the SEC said.
The complaint alleges that Janes held a conference call with investors in November 2010 after the FDA for the third time denied clearance for Imaging3 to market its proprietary scanner. Although the FDA cited concerns about the safety of the device and the quality of the images, Janes told investors that the FDA's issues were "not substantive" and largely "administrative," the SEC stated.
According to the SEC's complaint, Janes did not discuss the issues raised by the FDA in an October 2010 letter, such as the device's potential for overheating, and the fact that some sample images the company submitted were "scientifically invalid and useless," the SEC said.
The SEC's action charges Imaging3 and Janes with fraud and seeks a court order to bar them from future violations of federal securities laws, to require them to pay civil monetary penalties, and to bar Janes from serving as a public company officer or director.
