May 27, 2009
Judge hears Cuban insider trading case
A federal judge in Dallas is considering whether an insider-trading case against businessman Mark Cuban should be dismissed or move forward.
Attorneys for Cuban and the U.S. Securities and Exchange Commission argued legal points before U.S. District Judge Sidney Fitzwater Tuesday. The judge had yet to rule, The Dallas Morning News reported.The SEC alleges Cuban used insider knowledge when selling his shares in Mamma.com in 2004. The federal commission claims the billionaire dumped his shares after the company's top executive alerted him there would be a private offering of company shares, an action that would have diluted the value of his holdings.
The SEC said getting rid of the shares when he did saved the Dallas Mavericks owner more than $750,000, the Morning News reported.
Cuban's attorney argued the SEC is trying to widen the concept of insider trading.
The issue is how are we going to keep the U.S. government playing within the lines? Ralph Ferrara, an attorney for Cuban, said.
SEC attorney Kevin O'Rourke rejected the notion the commission is stretching the boundaries of the law.
We're only applying the law as it exists, he said.
After the hearing, Cuban had nothing to say about the case but told reporters to
just write about how good I look in my suit. I haven't worn it in 20 years.
And moments later as he drove away he added,
Just make note about how I'm driving American and a hybrid.