The US Securities and Exchange Commission (SEC) yesterday filed a lawsuit against Gilat Satellite Networks Ltd. (Nasdaq: GILT; TASE: GILT) VP corporate development and business strategy Joshua Levinberg for insider trading, "Reuters" reports. The SEC accuses him of buying shares of Scopus Video Networks, then traded on Nasdaq, after learning that the company was up for sale. The lawsuit was filed with the US District Court for the Southern District of New York in Manhattan.
The SEC says that, in late 2008, Levinberg knew that Scopus Video Networks was seeking to be acquired by Gilat or another company. He bought 102,172 Scopus shares in October-December 2008 at an average price of $3.56 per share, for a total of $363,000. The final purchase of 71,000 shares amounted to 88% of the trading volume in the share for that day.
The SEC says that, six days after the final purchase, Harmonic Inc. (Nasdaq: HLIT) acquired Scopus Video Networks at $5.62 per share, 57% higher than the average price paid by Levinberg for his shares. The SEC says that he made a profit of $188,000.
Levinberg's attorney, James Kleinhandler, told "Globes" that his client would reach a settlement with the SEC, under which he will pay $380,000. The payment will cover both the original amount made plus a fine. He will neither admit nor deny the charges. Kleinhandler said, "There is nothing to prevent my client from continuing to be a party at interest in Gilat."
Gilat said in response, "This is a settlement reached personally between Joshua Levinberg and the SEC. The settlement has no effect whatsoever on the company."
Published by Globes [online], Israel business news - www.globes-online.com - on February 3, 2010
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