Dallas, TX, United States (4E) – A federal court jury in Dallas ruled Wednesday that Mark Cuban, owner of the NBA team Dallas Mavericks and star of the reality television show “Shark Tank,” did not commit insider trading when he sold his shares in an Internet company in 2004.
The jurors based their decision on evidences that Cuban’s lead attorney, Stephen A. Best, said proved that the billionaire never entered into an agreement of confidentiality with Mamma.com and had no obligation to tell the Canadian company that he was selling his stock.
The Securities and Exchange Commission (SEC) filed the civil case against Cuban, 55, in 2009 on charges that he used inside information from Momma.com CEO Guy Faure to avoid a $750,000 loss in 2004. The SEC evidence was a June 2004 phone talk between Cuban and Faure, who disclosed to the biggest stockholder the company’s plans for a private investment in public equity that would have devalued Cuban’s holdings.
Cuban sold all his 6.3 percent stake or 600,000 shares for $7.9 million after the conversation and after getting more details of the planned stock sale from the company’s financial advisers.
SEC’s lead trial lawyer, Jan Folena, told jurors the trade was illegal.
Cuban argued in court that he was not prohibited from selling his shares on the information. His lawyer, Thomas Melsheimer, argued that Cuban made no agreement not to sell his stock and disclosed his intent to sell his stock.