Law Firm Technology Manager Accused of Insider Trades on Mergers
U.S. regulators sued a former law firm employee, claiming he reaped illegal profits by trading on inside information about acquisitions including Cerberus Capital Management LP’s July purchase of DynCorp International Inc.
Jeffrey Temple, 40, traded in advance of at least 22 buyouts since June 2009 while serving as technology manager for the law firm, the Securities and Exchange Commission said today in a lawsuit filed at federal court in Wilmington, Delaware. Temple and his brother-in-law, Benedict Pastro, reaped more than $182,000 in illegal profits from the trades, the SEC said in the suit, which didn’t identify the law firm.
Temple also traded ahead of 2009 announcements about Google Inc.’s planned acquisition of On2 Technologies and Disney Inc.’s bid for Marvel Entertainment Inc., the SEC said. He and Pastro made more than $34,000 trading ahead of the DynCorp announcement and about $23,000 on stock and call options purchased before an announcement by Facet Biotech Corp. that it had agreed to be acquired by Abbott Laboratories, according to the lawsuit. He left the law firm on Oct. 11, the SEC said.
“By virtue of his position as a law firm information systems and security manager, Temple exploited his access to confidential merger and acquisition information for his and his brother-in-law’s benefit,” Daniel Hawke, head of the SEC’s market abuse enforcement unit, said in a statement. The SEC is seeking disgorgement of profits and unspecified penalties.
Phone calls to Elizabeth Moskow-Schnoll, Temple’s attorney at Ballard Spahr LLP, and Daniel Lyons, a lawyer for Pastro, weren’t returned.
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