Ex-NBTY Director Insider Suit on Carlyle Buyout Settled

A former NBTY Inc. director, his three brothers and a friend agreed to pay more than $500,000 to settle insider-trading claims related to the vitamin manufacturer’s sale to Carlyle Group LP in 2010.

The settlement resolves a lawsuit filed by the Securities and Exchange Commission today in Manhattan federal court. Glenn Cohen, 54, who served on the board of Ronkonkoma, Long Island-based NBTY from 1988 until the company was acquired by Carlyle, the SEC said. He told his brothers Craig, Steven, Marc and Marc's girlfriend Laurie Topal about the impending takeover, according to the regulator.

The tip allowed Glenn Cohen’s brothers and Topal to buy shares of NBTY and make about $175,000 on the sale of the stock after the acquisition was announced publicly, according to the complaint.

“As a board member at NBTY for more than 20 years, Glenn Cohen knew the importance of maintaining the confidentiality of company information,” Amelia A. Cottrell, associate director in the SEC’s New York Regional Office, said in a statement. “Unfortunately, when presented with exclusive details about an impending sale, he breached his duty to NBTY shareholders in order to enrich his own family members.”

The Cohens and Topal didn’t admit or deny the allegations in the settlement, which is subject to court approval, the SEC said in a statement.

“My client is pleased to have the matter resolved,” said Jeffrey Plotkin, a lawyer at Finn Dixon & Herling LLP, who’s representing Steven Cohen. Topal’s lawyer, David Gourevitch, said she was glad to put the matter behind her.

Glenn Cohen’s attorney, Robert Knuts of Sher Tremonte LLP, declined to comment on the case when contacted by phone. Steven D. Feldman, an attorney for Marc Cohen, and Michael G. Considine, an attorney representing Craig Cohen, didn’t immediately respond to telephone messages.

The case is Securities and Exchange Commission v. Cohen, 14-cv-3655, U.S. District Court, Southern District of New York (Manhattan).

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