CBD Inhaler Co. CEO Lied About Nasdaq, Major Sales! Stock Crashes!

SEC v. Rapid Therapeutic Science Laboratories, Inc., Donal R. Schmidt, Jr. — U.S. Securities and Exchange Commission Litigation Release No. 26437, dated December 12, 2025.

The SEC charged Rapid Therapeutic Science Laboratories, Inc. (RTSL) and its CEO, Donal R. Schmidt, Jr., with making fraudulent statements about the company's business, including claims about certifications, sales contracts, and stock listings. Both defendants settled with the SEC, agreeing to permanent injunctions and monetary penalties.

In Plain English

Imagine a company selling a special inhaler. The company and its boss told people it had important safety approvals, big deals with other companies, and was listed on a stock exchange. They also said their scientist had advanced degrees and the inhalers were safe and legal. In reality, these claims were not true. The company and its boss had to pay money to settle the case and were banned from certain business activities.

Disclaimer: all facts are drawn from the SEC's own filings; the claims described are allegations unless and until a court rules or the parties settle, and some cases end in dismissal.

How the Alleged Scheme Worked

1. False Claims About Certifications Defendants falsely claimed that Rapid Therapeutic Science Laboratories, Inc. (RTSL) had obtained an industrywide certification related to manufacturing and product safety for its CBD inhalers.
2. Fabricated Sales Contracts RTSL and its CEO, Donal R. Schmidt, Jr., falsely stated that the company had secured major sales contracts, misleading investors about the commercial success and demand for their products.
3. Misleading Laboratory Standards The company and its CEO misrepresented that RTSL's laboratory met international standards, implying a level of quality and compliance that was not actually achieved.
4. False Scientist Credentials Defendants falsely claimed that RTSL's chief science officer was an engineer with both bachelor's and doctoral degrees, inflating the perceived expertise within the company.
5. Inhaler Safety and Legality RTSL and Schmidt made untrue statements that their CBD inhalers were safe and legal, potentially deceiving investors about the risks associated with the product.
6. Fake Nasdaq Listing Approval The defendants falsely announced that RTSL's stock listing application had been approved by Nasdaq, a significant misrepresentation designed to boost investor confidence and stock value.
7. SEC Complaint Filed On September 18, 2023, the SEC filed a complaint detailing these alleged fraudulent statements and misrepresentations made by RTSL and its CEO.
8. Final Judgments Entered On November 24, 2025, final judgments were entered against both RTSL and Donal R. Schmidt, Jr. by the U.S. District Court for the Northern District of Texas.

The Enforcement Action

On November 24, 2025, the U.S. District Court for the Northern District of Texas entered final judgments against Dallas-based Rapid Therapeutic Science Laboratories, Inc. ("RTSL") and its chief executive officer, Donal R. Schmidt, Jr. The SEC had charged them with making a series of false and misleading public statements regarding RTSL's business, including claims about industry certifications, major sales contracts, laboratory standards, executive credentials, product safety and legality, and Nasdaq listing approval. Without admitting or denying the allegations, RTSL consented to a permanent injunction and an order to pay disgorgement of $686,090, plus $183,528 in prejudgment interest. Schmidt consented to a permanent injunction, an order to pay disgorgement of $144,285, plus $38,596 in prejudgment interest, and a civil penalty of $236,451. Additionally, Schmidt is barred from serving as an officer or director of a public company and from participating in any penny stock offering for five years.

Named in this action: Rapid Therapeutic Science Laboratories, Inc., Donal R. Schmidt, Jr..

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