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Orange County Insider Trading Case Hastens SEC Retreat From Federal Court

November 21, 2014

By CHRISTOPHER MCGRATH & HOWARD M. PRIVETTE

In what has been described as the largest insider trading case ever filed in Orange County by the Securities and Exchange Commission (SEC), a jury earlier this year took only a few hours to return a verdict that found no wrongdoing by Manouch Moshayedi, the co-founder and former Chairman and CEO of sTec, Inc. The SEC had filed the case in the Santa Ana federal court, claiming that Mr. Moshayedi unjustly enriched himself by $267 million when he and family members sold nine million shares of the companyʼs stock while allegedly in possession of material, non-public information. The SEC also alleged that Mr. Moshayedi made material misrepresentations about sTecʼs business. On June 6, 2014, the jury rejected all of the SECʼs claims.