Oct. 7 (Bloomberg) -- The U.S. Securities and Exchange Commission is appealing the dismissal of its lawsuit accusing Dallas Mavericks basketball team owner Mark Cuban of insider trading, the agency told a federal court in Texas.

The SEC today filed a notice of appeal at U.S. District Court in Dallas without indicating what arguments it may make. A judge had dismissed the agency’s lawsuit in July, saying Cuban’s alleged promise to keep information confidential about Mamma.com Inc. didn’t bar him from trading the company’s stock.

“We believe the district court erred in dismissing our complaint, and we look forward to presenting our position to the Fifth Circuit Court of Appeals,” SEC spokesman John Nester said. Attorneys for Cuban vowed to fight the appeal.

The agency claimed in its November lawsuit that Cuban learned in a 2004 telephone call with Mamma.com’s chief executive officer that the Montreal-based Internet search firm planned a private offering of company stock at a below-market price. Later that day, Cuban allegedly avoided losses of more than $750,000 by ordering the sale of his 6.3 percent stake.

By promising to keep the offering confidential, Cuban should have been barred from trading, the SEC argued. Cuban denies making the agreement. Even if he had, a promise of confidentiality doesn’t preclude trades, U.S. District Judge Sidney A. Fitzwater said.

‘Desperate Attempt’

“This appeal is nothing more than the SEC’s desperate attempt to shock a heartbeat into a case that was dead on arrival,” said Stephen Best, a lawyer for Cuban at Dewey & LeBoeuf LLP. Fitzwater “dismissed the complaint based on the SEC’s own version of the facts and, in the process, invalidated one of the SEC’s insider-trading rules.”

Cuban, who assembled a team of at least six lawyers to help defeat the claims, has asked Fitzwater to order the regulator to pay for his legal costs. The SEC has objected, and the judge hasn’t issued a decision. Best said the agency’s appeal may be a response to that demand.

The case is SEC v. Cuban, 08-cv-2050, U.S. District Court, Northern District of Texas (Dallas).

To contact the reporter on this story: David Scheer in New York at dscheer@bloomberg.net.

Last Updated: October 7, 2009 13:45 EDT