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The Fifth Circuit Reinstates the SECs Insider Trading Case Against Mark Cuban

On Sept. 21, 2010, a federal court of appeals reversed the July 2009 decision of a lower court and reinstated an insider trading case brought by the Securities Exchange Commission (SEC) against Mark Cuban, the internet billionaire and owner of the Dallas Mavericks. The lower courts decision was significant because it appeared to conflict with the traditional interpretation of U.S. insider trading laws. Although the case appears far from over, the appeals courts decision reaffirms the need for public companies, their agents and other market participants to follow certain guidelines when communicating and receiving material, non-public information regarding proposed financings and other significant transactions.

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