Facing insider trading trial, Cuban says he's eager to prove his innocence
DALLAS — The jury was selected on Monday in the civil trial of Mt. Lebanon native Mark Cuban, the billionaire owner of the Dallas Mavericks NBA basketball team, who faces charges of insider trading in shares of a little-known Internet search company nearly a decade ago.
Cuban, 55, is accused of selling his 600,000 shares of the former Mamma.com Inc. on June 28 and 29, 2004, soon after learning from Chief Executive Guy Faure that the company was planning an equity offering that could dilute his 6.3 percent stake.
The Securities and Exchange Commission said Cuban avoided a $750,000 loss after the Montreal-based company announced the offering, causing its stock price to drop 9.3 percent on June 30.
Cuban has maintained that he did nothing wrong and that information he may have received was neither confidential nor material enough to trigger a violation.
The jury trial before U.S. District Judge Sidney Fitzwater in Dallas is expected to last eight to 10 days, court papers show. The trial could stretch into mid-October, with breaks.
Fitzwater said he intended the jury to start deliberating by Oct. 17. That schedule may be affected by a federal government shutdown because of the congressional spending bill impasse, the judge said.
“The government shutdown will not affect the trial of this case for at least two weeks,” said Fitzwater, who has allotted four days for it this week and three next week. The judge said he will revisit the issue later in the proceedings.
Cuban arrived at court wearing a navy blue suit and tie and telling reporters, “I am excited about this, to finally come to court,” Cuban said. “I won't be bullied. That's the key element.”
While the SEC has become more aggressive in pursuing higher-profile defendants, the trial occurs in a case that predates that push, having begun in November 2008.
Forbes magazine estimates Cuban's net worth at $2.5 billion.
Cuban made his fortune on the eve of the dot-com crash in 1999, selling his start-up, Broadcast.com, to Yahoo for nearly $6 billion. He bought the Mavericks months later and has co-ownership stakes in the movie chain Landmark Theaters, among other media companies.
The SEC seeks to recoup ill-gotten gains, impose civil fines and obtain a permanent injunction to bar Cuban from similar alleged misconduct.
Fitzwater dismissed the SEC lawsuit in 2009, but a federal appeals court revived the case next year.