Hologram USA Networks faces charges for misleading investors for various holographic concerts displaying late artists like Tupac Shakur, Whitney Houston, and Roy Orbison.
According to Law360, Hologram USA Networks CEO Alki David sold $100,000 worth of unregistered shared ahead of an aborted IPO and misled investors about having rights to various 3D performances, the U.S. Securities and Exchange Commission said. The company allegedly made two unregistered stock offerings between November 2017 and March 2018.
Investors were allegedly drawn to the Hologram USA’s website by a TV commercial regarding an investment opportunity. They were told that they would have “exclusive” rights to display “iconic talent” in a purported network of eight hologram equipped theaters throughout the U.S., SEC’s complaint read. The complaint alleges that Hologram USA used general solicitation to allow non-accredited investors to purchase convertible shares, which is in violation of certain federal registration requirements. The site promised the “resurrection” performances from deceased artists with “live” concerts from hologram figures.
David has been charged with violating the anti-fraud provisions of the Securities Act of 1933 and the Securities Exchange Act of 1934. He is also being charged with “aiding and abetting Hologram USA’s violations of the anti-fraud provisions,” SEC.gov reports.
David and his legal team have denied all allegations and intent to fight the SEC allegations, Street Insider reports.
“I spent $80 million of my own money to build my company and take it public,” David said. “I hired the best people and did everything by the book, working closely with NASDAQ. Twice, the SEC has targeted me and blocked my efforts to create 100s of jobs as I advance the hologram industry. And now this. They’ve picked the wrong guy to fish for some settlement with. I’m not going to take it.”
David went on to note that Hologram USA never claimed to have the rights to produce future Hologram Tupac events, unlike SEC’s claim. Additionally, he alleges that the SEC complaint misconstrues many details about Hologram USA’s business plan; in the past, Hologram USA has produced successful shows like Billie Holiday and Jackie Wilson and Juan Garbriel and Jenni Rivera, as well as live hologram shows featuring celebrities Jimmy Kimmel, Jack Black, Kacey Musgraves, and Chief Keef.
This isn’t the first time David has made headlines recently; a Beverly Hills comedy writer has been the third women to take a sexual harassment case against David to trial since April. According to Patch, Lauren Reeves said she endured months of sexual innuendo and inappropriate conduct by her boss since 2016. David has denied all wrongdoing and his previous case was declared a mistrial with 8-4 jurors favoring David.
Updated October 1 to include David’s response to the allegations