Mark Cuban went toe to toe with the SEC over insider trading allegations and it appears as if he won.
From the WSJ:
A federal judge on Friday dismissed the U.S. Securities and Exchange Commission’s insider-trading case against Dallas Mavericks owner Mark Cuban.
The SEC alleged in November that Mr. Cuban sold his stake in a Canadian Internet company just after receiving confidential information about the company’s plans to issue low-price shares.
Mr. Cuban denied the allegations and argued that the SEC’s case should be dismissed because the agency was seeking to expand the definition of what constituted insider trading.
U.S. Chief District Court Judge Sidney Fitzwater in Dallas sided with Mr. Cuban on Friday and threw out the case. He did give the agency 30 days to refile charges if it could strengthen its allegations.
In a 35-page ruling, Judge Fitzwater said Mr. Cuban only would be liable for insider trading if he had made a promise not to trade shares based on the confidential information he allegedly received.
The SEC’s case had to be dismissed, the judge said, because the agency never alleged that Mr. Cuban made such a promise.
It was a weird case to begin with but the type that is often settled out of court. Cuban had the wherewithal to fight as well as the contrary nature. If you want a good analysis from a legal point of view, check out John Carney’s post at Clusterstock.