|  | | 2008 News and Press Releases | | |
HEADLINE NEWS:
Mavericks' Cuban Sued by SEC for 2004 Insider Trading
David Scheer
Bloomberg. November 17, 2008
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EXCERPT: Billionaire Mark Cuban, the owner of the Dallas Mavericks basketball team, was sued by U.S. regulators over claims he made illegal insider trades four years ago in shares of Internet search company Mamma.com Inc. Cuban, 50, became ``very upset and angry'' in 2004 after the company told him in confidence it planned to sell stock below its trading price, the Securities and Exchange Commission said in a civil suit today at federal court in Dallas. Within four hours, he sold his 6.3 percent stake, avoiding more than $750,000 in losses after Mamma.com's sale was announced, the SEC said. ``It is fundamentally unfair for someone to use access to nonpublic information to improperly gain an edge on the market,'' Scott Friestad, the SEC enforcement official overseeing the case, said in a statement. The SEC's complaint focuses on a series of phone calls and messages between Cuban, the company and his broker. Cuban, who in 2006 started the Web site sharesleuth.com aimed at exposing ``securities fraud and corporate chicanery,'' vowed in a statement to fight the SEC's allegations. A statement on Cuban's blog said the SEC's claims stem from a ``gross abuse of prosecutorial discretion'' and ``are infected by the misconduct of the staff of its enforcement division.'' "I am disappointed that the commission chose to bring this case based upon its enforcement staff's win-at-any-cost ambitions,'' the statement quotes him as saying. ``The staff's process was result-oriented, facts be damned. The government's claims are false and they will be proven to be so.'' The agency's suit seeks to impose unspecified fines and confiscate gains from the trades. […] Montreal-based Mamma.com changed its name to Copernic Inc. in 2007, according to the SEC. Copernic Chief Executive Officer Marc Ferland also didn't return a call seeking comment. Cuban is owner of the HDNet high-definition television channel and the Landmark Theater chain. |
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