Tuesday, May 27, 2008
The federal district court for the Southern District of New York entered a Final Judgment against defendant Alexander Yaroshinsky in SEC v. Yaroshinsky, restraining and enjoining him from future violations of Section 10(b) of the Securities Exchange Act of 1934 ("Exchange Act") and Rule 10b-5 thereunder. The SEC alleged that Yaroshinsky, a former Vice President of Clinical Operations and Biostatistics for Connetics Corporation, learned material non-public information concerning the FDA staff's preliminary analysis of the carcinogenicity tests of Velac Gel, an acne drug then being developed by Connetics, and tipped his co-defendant Victor Zak to this information and then traded on it himself. Yaroshinsky consented to the entry of the judgment without admitting or denying any of the allegations of the Commission's complaint. Yaroshinsky is liable for disgorgement in the amount of $354,927, plus prejudgment interest thereon in the amount of $84,275, and a civil penalty of $283,798. Zak settled charges related to this case last yeardisgorgement of $138,569 for his own trades, plus an equal civil penalty of $138,569 and prejudgment interest of $32,902. He is also paying the $216,358 in disgorgement that Zak was unable to pay, plus prejudgment interest thereon of $51,373 and a civil penalty of $145,229.