Mark Cuban says no confidentiality agreement broken

Mark Cuban

Mark Cuban is not one to hush up in the face of controversy or for that matter, let others get the last word in.

The owner of the pro basketball's Dallas Mavericks and founder of Broadcast.com has responded again to the insider-trading charges filed against him by the Securities and Exchange Commission.

The SEC accuses Cuban of selling his shares in Internet-search firm Mamma.com in 2004 after acquiring nonpublic information and avoiding a $750,000 loss. The feds charge that Cuban made an agreement with Mamma.com's CEO to not disclose the information about a future stock offering.

Cuban denied in a post on his personal blog that he made any such agreement. But we'll leave it for Cuban and his lawyers to explain. Below is a copy of the post from Cuban's blog.

On behalf of Mark Cuban

RE: SEC Civil Action in the United States District for the Northern District of Texas, Dallas Division

The SEC knows their case centers on one telephone conversation between two individuals- four years ago. The SEC claims there was an agreement between these parties to the conversation to keep certain information confidential. We interviewed Guy Faure, the former CEO of Mamma.com Inc., with whom the SEC claims Mr. Cuban made an agreement. We had a court reporter transcribe the interview. There was no agreement to keep information confidential. Here is a relevant excerpt from the interview with Mr. Faure:

CHRISTOPHER CLARK :

1) Q- We spoke earlier about you were telling Mr. Cuban in words or substance : "I have confidential information for you".

A- Right.

2) Q- Do you recall anything Mr. Cuban said in response or reply to that statement by you ?

A- No, I do not.

The SEC knows this-they have the transcript, yet they brought the case anyway. Why? Do they have a different statement from Mr. Faure ?

Why did the SEC end their multi-year investigation of Mamma.com Inc. for alleged securities laws violations days before interviewing present and former Mamma.com Inc. executives about this matter? Was the timing a coincidence? We think not.

[sanenazok]

Confidentiality agreement or not if Cuban used information not available to others to sell his stocks then he's guilty of trading based on insider information.