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SEC LITIGATION RELEASE
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EXTRACTED KEY WORDS
TRADING EXCHANGE COMMISSION SOROOSH SECURITIES DISTRICT UNITED STATES CALIFORNIA OCTEL POSSESSION NONPUBLIC INFORMATION LITIGATION SHAHRYAR SOROOSH NORTHERN DISTRICT FINDINGS LAW INSIDER STOCK DELAY DEFENSE PATTERN ASSERTION TRADING ACTIVITY SURROUNDING CONSISTENT INSIDER KNOWLEDGE PLAUSIBLE EXPLANATION ASSISTANCE NASD REGULATION MATTER |
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 15433 / August 6, 1997
SECURITIES AND EXCHANGE COMMISSION v. SHAHRYAR SOROOSH, United States
District Court for the Northern District of California, Civil Action
No. C
96-3933 VRW.
The Securities and Exchange Commission announced today that on
August
5, 1997, the Honorable Vaughn R. Walker of the United States District
Court
of the Northern District of California, issued a Judgment and Findings
of
Fact and Conclusions of Law holding that Shahryar Soroosh, a resident
of
Saratoga, California violated the federal securities laws by engaging
in
insider trading. The Court ordered Soroosh to disgorge $505,819.00
plus
prejudgment interest. The Court's opinion follows a four-day bench
trial
earlier this year.
The Court found that Soroosh, a forty year old, former senior
software
engineer at Octel Communications Corporation ("Octel"), amassed a
substantial short position in the stock and options of Octel while in
possession of material, nonpublic information concerning an Octel
software
delay. The delay was publicly announced on October 24, 1996. Upon
the
announcement, the price of Octel's common stock fell by over 35%,
from
$24.50 to $15.70 per share. As a result, Soroosh realized profits of
over
$500,000, based on his 35,000 share short position and his 80 put
contracts, all of which he had accumulated in the weeks before the
announcement. The Commission instituted its suit within days of the
trading, on October 29, 1996.
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