Lines Overseas Management has lost more ground in its legal struggle against the enforcement of US Securities and Exchange Commission subpoenas for information related to SEC probes of suspected securities fraud.

SEC subpoenas served on LOM managing director Scott Lines almost two years ago sought information related to trading of HiEnergy Technologies, Sedona Software Solutions and SHEP Technologies. The SEC recently withdrew its court application for enforcement of the HiEnergy subpoenas on the grounds that it no longer needed information from LOM ?based on recent developments unrelated to this action,? but it continues to seek the court?s help in enforcing the subpoenas related to Sedona and SHEP.

LOM turned to the Court of Appeals earlier this year after US District Court Richard Roberts turned down their application to stay a year-old Magistrate Judge?s order of obedience pending appeal.

In his ruling late last year, Judge Roberts determined that LOM and Lines had failed ?to carry their burden of persuasion on the four factors considered in determining whether a stay is warranted?.

The Judge said LOM failed to show ?irreparable harm that is certain and great? or ?demonstrate that they are likely to succeed on the merits of their position, even under a standard of review that is favourable to them.?

He also said that they did not show the balance of hardships tips in favour of granting the stay or demonstrate that the public interest would be served by the stay.

Judge Roberts order for compliance with the Magistrate Judge?s original order to produce the documents under subpoena was temporarily blocked when the Court of Appeals granted an administrative stay in January this year.

However, in its order last week, the US Court of Appeals dissolved that stay and denied LOM?s emergency motion for stay pending appeal on the grounds that LOM ?had not satisfied the stringent standards required for a stay pending appeal.?

The Court of Appeals also denied a motion for summary reversal while affirming US District Court Judge Richard Roberts denial of LOM?s motion for a stay.

?Given this court?s determination that appellants have not met the requirements for preliminary relief pending appeal, it necessarily follows that the district court did not abuse its discretion in applying the same standard to deny appellants request for a stay of the magistrate judge?s order,? the Court of Appeals said.

The Court of Appeals said that the denial of the motion for a stay is not, however, to be taken as a judgement as to whether the district court is required to undertake de novo review ? a fresh look ? of the magistrate judge?s decision. That issue is now pending before the district court and a decision is expected promptly.

A LOM spokesperson said this week that he could not comment on the Court of Appeals order as the company and its legal counsel were still in the process of evaluating it.