Notice is hereby given, pursuant to the provisions of the Government in the Sunshine Act, Pub. L. 94-409, that the Securities and Exchange Commission will hold the following meetings during the week of March 28, 2005:
An open meeting will be held on Tuesday, March 29, 2005, at 10 a.m. in Room 1C30 and closed meetings will be held on Tuesday, March 29, 2005, at 11 a.m. and Thursday, March 31, 2005, at 2 p.m.
Commissioners, Counsel to the Commissioners, the Secretary to the Commission, and recording secretaries will attend the closed meeting. Certain staff members who have an interest in the matters may also be present.
The General Counsel of the Commission, or his designee, has certified that, in his opinion, one or more of the exemptions set forth in 5 U.S.C. 552b(c)(3), (5), (7), (9)(B), and (10) and 17 CFR 200.402(a)(3), (5), (7), 9(ii) and (10), permit consideration of the scheduled matters at the closed meeting.
Commissioner Goldschmid, as duty officer, voted to consider the items listed for the closed meeting in closed session.
The subject matter of the open meeting scheduled for Tuesday, March 29, 2005, will be:
The Commission will hear oral argument on appeals by Robert W. Armstrong, III and Start Printed Page 15372the Division of Enforcement of an initial decision of an administrative law judge. Armstrong was formerly controller of National Medical Care, Inc. (“NMC”), a subsidiary of W.R. Grace & Co. (“Grace”). The law judge found that Armstrong participated in a scheme to manipulate Grace's reported earnings to achieve predetermined targets. The alleged scheme involved improperly recording excess earnings as reserves and later using the excess reserves to bolster earnings, thereby achieving the impression that Grace had steady, consistent growth in income over a period of several years.
The law judge found that Armstrong willfully violated Section 10(b) of the Securities Exchange Act of 1934 and Exchange Act Rule 10b-5 and that he was a cause of Grace's violation of those provisions. The law judge also concluded that, as a result of the scheme to manipulate Grace's earnings, Grace's periodic reports during the relevant period included financial statements that were not in accordance with Generally Accepted Accounting Principles (“GAAP”) and that were materially misleading in violation of the periodic reporting requirements contained in Exchange Act Section 13(a) and Exchange Act Rules 12b-20, 13a-1, and 13a-13. The law judge found that Armstrong was a cause of these violations. The law judge further found that Armstrong violated the recordkeeping requirements of Exchange Act Section 13(b)(5) and Exchange Act Rule 13b2-1, and was a cause of Grace's violation of these provisions and of Exchange Act Section 13(b)(2). The law judge imposed a cease-and-desist order against Armstrong.
The law judge dismissed the charges brought pursuant to Commission Rule of Practice 102(e). The law judge held that Armstrong had not been appearing or practicing before the Commission, and dismissed the Rule 102(e)(1)(iii) charges on this basis.
Armstrong appeals the law judge's conclusion that he violated and caused Grace's violations of the federal securities laws and the Commission's rules. He also maintains that there is no basis in the public interest for the imposition of a cease-and-desist order. The Division appeals the law judge's dismissal of the Rule 102(e) charges. The Division seeks to deny permanently to Armstrong the privilege of appearing or practicing before the Commission.
Among the issues likely to be considered are:
(1) Whether respondent committed the alleged violations; and
(2) If so, whether sanctions should be imposed in the public interest.
The subject matter of the closed meeting scheduled for Tuesday, March 29, 2005, will be:
The subject matter of the closed meeting scheduled for Thursday, March 31, 2005, will be:
Formal orders of investigations;
Institution and settlement of injunctive actions; and
Institution and settlement of administrative proceedings of an enforcement nature.
At times, changes in Commission priorities require alterations in the scheduling of meeting items.
For further information and to ascertain what, if any, matters have been added, deleted or postponed, please contact:
The Office of the Secretary at (202) 942-7070.Start Signature
Dated: March 22, 2005.
Jonathan G. Katz,
[FR Doc. 05-5986 Filed 3-22-05; 4:21 pm]
BILLING CODE 8010-01-P