The Lines Overseas Management Ltd. and the Lines brothers could stand trial in Manhattan later this year after the US judge dealing with the case set a hearing date of October 12, it was revealed on Friday.

The US Securities and Exchange Commission's (SEC) motion for a partial summary judgement against defendants including Lines Overseas Management was denied by Judge Denise Cote as reported in The Royal Gazette last week.

The SEC had applied for the judgement basing their allegations including securities fraud against Bermudian brothers Brian Lines and Scott Lines, as well as LOM, Anthony Wile, Wayne Wile, Robert Chapman, William Todd Peever, Philip James Curtis and Ryan Leeds.

LOM and the Lines brothers filed their own motion for a partial summary judgement in the case, which was also denied by Judge Cote in rulings filed in the US District Court for the Southern District of New York last week. The long-running case will now either be resolved through a settlement agreement between the SEC and the defendants or a court trial.

A new settlement dialogue between the parties has already by initiated and is set to continue over the following weeks

Judge Cote took the additional step of ordering court-mediated settlement discussions to take place no later than mid-September, providing another opportunity for a settlement before the trial.

The SEC claims that in two alleged schemes, the defendants artificially drove up the stock prices of two publicly-traded shell companies, Sedona and SHEP Technologies Inc., through the issuance of misleading information and price manipulation and then, while recommending that their clients buy shares in the companies, secretly sold their own stock.

LOM and the Lines brothers have denied these claims and have stated, in each case, the business opportunity they were working towards was genuine.