DALLAS — Mark Cuban sparred with a government lawyer Thursday over why the billionaire Dallas Mavericks owner dumped his shares in a Canadian search-engine company in 2004. Cuban said he had several reasons, including learning about ties between the company and a convicted stock swindler.
The Securities and Exchange Commission says Cuban sold only after the chief exeutive of Mamma.com Inc. told him confidentially of a pending stock offering that would lower the value of his shares.
In federal court, an SEC lawyer used Cuban’s own words to undermine his defense. In several e-mails and blogs from 2004, Cuban said he sold his shares in Mamma.com because he didn’t like the private stock offering the company was planning. The CEO, Guy Faure, testified Cuban agreed to keep a phone call confidential, and that’s when he told Cuban about the stock offering. Faure said Cuban was angry; he was prohibited from selling his shares until the offering was public. But Cuban sold anyway. The SEC wants Cuban to pay a fine, plus the $750,000 in losses he avoided.