Mavs owner Mark Cuban finally gets his day in court to respond to the Security and Exchange Commission about his alleged insider trading moves.
The insider trading suit filed against Cuban by the U.S. Securities and Exchange Commission last year is scheduled to receive its first hearing Tuesday when attorneys present oral arguments on a motion by the billionaire owner to have the case dismissed.
“The basis on which they’re going after Cuban hasn’t been tried before,” said Peter Henning, a law professor at Wayne State University in Detroit who formerly worked as an attorney in the SEC’s enforcement division. “Whether the SEC is going to be able to stretch (its authority) that far certainly remains to be seen.”
The SEC alleges that Cuban engaged in insider trading when he sold his shares in a Canadian Internet search engine company, Mamma.com Inc., after receiving confidential information that the company planned to sell additional shares through a private offering in 2004. Cuban was able to avoid more than $750,000 in losses by selling his shares, according to the SEC.
All I can say is this seems to be an unprecedented type of case for the SEC. I’m pretty sure it’s all going to come down to legal definitions until they all get tired of definitions. I’m pretty sure Cuban has some pretty deep pockets to keep arguing that point.