[外電] Judge tosses Cuban insider trading suit
Source: http://sports.espn.go.com/nba/news/story?id=4336200
*********************************************************************
Judge tosses Cuban insider trading suit
Updated: July 17, 2009, 6:45 PM ET / ESPN.com news services
*********************************************************************
DALLAS -- A federal judge dismissed a civil insider-trading lawsuit against
Dallas Mavericks owner Mark Cuban on Friday, dealing the Securities and
Exchange Commission a rare high-profile setback.
U.S. District Judge Sidney A. Fitzwater ruled that the SEC could not hold
Cuban liable for insider trading because the agency didn't allege the
billionaire NBA team owner had agreed not to trade based on confidential
information he received about an Internet search engine company, Mamma.com
Inc.
The judge wrote in his 35-page ruling that the SEC could file an amended
complaint within 30 days if it can allege that Cuban agreed not to sell stock
when he told the company's chief executive that he wouldn't divulge secret
information he was about to receive in 2004.
The SEC said Cuban avoided a loss of $750,000 by selling his 600,000 shares,
which represented a 6.3 percent stake in the company.
Fitzwater, however, rejected most of Cuban's claims over how his fiduciary
relationship with Mamma.com should be applied to the law.
Scott Friestad, associate director of the SEC's Division of Enforcement, said
in a statement that the commission was reviewing the ruling and weighing its
options.
Ralph Ferrara, one of Cuban's attorneys, said he needed time to digest the
ruling but was initially impressed with what he called Fitzwater's "appellate
court level" analysis.
"It sounds like unlike many trial courts on motions to dismiss, he really
tried to come to grips with the fundamental legal policy questions that we
raised," Ferrara said.
Cuban's attorneys at the New York law firm of Dewey & LeBoeuf said in a
statement they were "grateful" for the ruling.
"The court employed a reasoned and thoughtful approach ... and chose not to
be bound by labels and monikers or resort to 'technicalities," the statement
said.
In a posting on his Twitter page Friday, Cuban wrote, "Its been a great day
so far , and its only going to get better ! Back to Dallas to see the Fam !!"
Five years ago, Mamma.com Chief Executive Guy Faure told Cuban by phone that
the company was planning to raise capital in a so-called private placement in
a public equity offering known as a PIPE, the SEC lawsuit said.
Faure began the conversation by saying he was about to give confidential
information and Cuban agreed to keep it to himself, the SEC said. According
to the lawsuit, Cuban became angry because he said PIPEs dilute stock value
for existing shareholders, and he ended the call by saying, "Well now I'm
screwed. I can't sell."
The SEC alleges that Cuban sold his shares hours after the phone call from
Faure, before the announcement of the private offering.
Fitzwater ruled that Cuban's statement can't "reasonably be understood" as an
agreement not to sell based on the information.
"Thus while the SEC adequately pleads that Cuban entered into a
confidentiality agreement, it does not allege that he agreed, expressly or
implicitly, to refrain from trading on or otherwise using for his own benefit
the information the CEO was about to share," Fitzwater wrote.
Phillip Stern, a former SEC staffer now in private practice, said the agency
could pursue an appeal rather than try to amend the Cuban complaint. He said
the decision would come down to whether the agency thought it could
successfully attack Fitzwater's ruling, which he said was surprising.
But another analyst said the SEC generally must prove what Fitzwater's ruling
required: that defendants agreed to keep information confidential and
promised not to trade on it.
"This was a frontier case for the SEC," said J.W. Verret, a law professor at
George Mason University who also practiced securities enforcement law in
Washington. "The SEC was straining insider trading law beyond its proper
scope to catch a big fish, and it lost. It's time for the SEC to go home and
lick its wounds."
The 50-year-old Cuban is a tech entrepreneur who sold his Broadcast.com to
Yahoo Inc. in 1999 at the height of the dot-com boom. He bought the Mavericks
in 2000.
Cuban runs a Web site called Sharesleuth.com, which bills itself as providing
"independent Web-based reporting aimed at exposing securities fraud and
corporate chicanery." A companion site, BailoutSleuth.com, tracks the
government's $700 billion financial rescue plan.
*********************************************************************
--
--
t a █◣◢█ ▎ ◣◢ ▊ █◣◢█ █◣◢█ █◣◢█ █◣◢█ t a
h n ◤SIXERS◥ ▎SIXERS▊ ◤ @NBA ◥ ◢Ｅ ３◣ ◢ ★ ◣ ◤３ ★◥h n
e s ★ ３ ★★◤Ａ ◥★★▆EAST▆★ theEASTer3e s
w ３ ６ ★ALL-STAR★★ Ｓ ★★ ３ ★★★★★★★ w
e the ★the ★★the Ｔ ★★the ★ ───── e
--
※ 發信站: 批踢踢實業坊(ptt.cc)
◆ From: 58.114.82.28
Mavericks 近期熱門文章
PTT體育區 即時熱門文章
