SEC sues for congressional papers in insider trading probe
NEW YORK — The Securities and Exchange Commission has filed a lawsuit in New York seeking to compel the House Ways and Means Committee and a top House health care aide to turn over documents in an insider trading probe, a development that could begin a power struggle between two branches of government.
U.S. District Judge Paul Gardephe in Manhattan on Friday ordered the committee and staffer Brian Sutter, a possible source of the leak, according to the SEC, to appear before him July 1. He said the committee must show why it should not be ordered to produce documents demanded by the SEC in May.
The SEC sought the subpoenas in an investigation testing the limits of federal insider-trading laws on whether the committee or staff members illegally passed on nonpublic information about a change in health-care policy. In seeking compliance with the subpoena demand, the SEC cited a 2012 law that requires public officials to keep confidential any nonpublic information about government matters that could move stock prices.
The regulator is investigating a spike in trading of health insurance companies, including Humana Inc., ahead of a government announcement last year that increased, rather than cut, payments to health insurers.
The SEC said that on May 19 the committee and Sutter notified the agency that they would refuse to comply with the subpoena demand because it was “repugnant to public policy.”
Kerry W. Kircher, general counsel for the House of Representatives, told The Associated Press that the SEC subpoenas “run seriously afoul of the Constitution's Speech or Debate Clause.” Kircher said House lawyers are aware the federal judge wants a response by Thursday and will respond on that ground, among others.
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments â either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.