Case 2:10-cv-01581 Document 1 Filed 09/16/10 Page 19 of 20

which prohibits the use of any device, scheme or artifice to defraud, or to make any untrue
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statement of a material fact or to omit to state a material fact in the purchase and sale of

3 securities. This violation negatively affected the financial integrity of the company and its

4 shareholders.
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63. By filing a false Form 4, the Company, Yao, Wen, Zhao, Thomson, corporate counsel
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and others violated the provisions of Section 10(b)(5) of the Exchange Act and Rule 10b-5
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promulgated thereunder which prohibits the use of any device, scheme or artifice to defraud, or
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to make any untrue statement of a material fact or to omit to state a material fact in the purchase
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10 and sale of securities. This violation negatively affected the financial integrity of the company

11 and its shareholders.

12 PRAYER FOR RELIEF

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WHEREFORE, Shaw prays for judgment against Defendants as follows:
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1. Money Damages, including general, special, consequential, incidental, compensatory,
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resulting, proximate, and nominal damages, in an amount to be proven at trial;
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2. Injunctive Relief, including, without limitation, temporary restraining orders,
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18 preliminary injunctions and permanent injunctions, including without limitation, Defendants

19 should be: (1) prohibited from any transaction in China Armco stock without prior approval of
20 this Court or the written consent of a Court Appointed Custodian; (2) required to maintain and
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protect and be prohibited from any transaction involving the proceeds of the sale of China
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Armco stock without prior approval of this Court or the written consent of a Court Appointed
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Custodian; (3) prohibited from destroying any books and records of the subject transactions
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25 including internal investigation identified on June 30, 2010; and (4) required to report to and

26 account to this Court, all transactions involving Yao's transfers and pledges of China Armco

27 shares, including stock transfer records and the proceeds from any sales/pledges thereof; and
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