Mark Cuban vs the SEC: Cuban Wins!

I've been very lightly following the SEC case against Mark Cuban. As a fellow Dallasite and Mark Cuban fan, I was excited to hear that he was cleared of all charges this week!

Apparently, back in 2004, Cuban sold 600,000 shares of Mamma.com stock before the company made a private maneuver that was seen as unfavorable to its current stock owners. He effectively sold off all of his shares in the company, amounting to nearly 8 million dollars, a few weeks before the company made the impending, unpleasant public announcement.

Among a number of other details Mark Cuban was made aware of this private equity offering when Mamma.com executives invited major investors to participate in the new placements. Cuban declined when he found out that the company had begun to associate itself with a known stock swindler, Irving Kott.

He also claims that he was never asked not to sell his existing shares nor was he bound to confidentiality. The jury agreed with his version of events considering there was no written confidentiality agreement to prove otherwise. Seems likely that one of the grittiest, shrewdest men in business today would want anything that he's agreed to in writing. Oral confidentiality agreements are worthless and I'm surprised that the SEC went to trial with nothing but a claim that, 'he promised!'

Cuban spent more than the potential punitive SEC fees and fines defending himself against these charges since the case was dropped and re-opened in 2009. He declined to settle with the US government based on principle, knowing he had not committed illegal trading activities. He's fortunate he had the funds to fight these charges.

All in all, I feel its foolish to forget that he foresaw the pop of the internet bubble so many years ago. He sold all of his Yahoo.com shares he earned in the sale of broadcast.com, just before the stock devalued shortly thereafter.

Mark Cuban is just a talented, opportunistic businessman who knows his way around the trading floor. That's why he's one of my grittiest entrepreneur idols!