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Editor: Eric C. Chaffee
Univ. of Toledo College of Law

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Thursday, February 26, 2009

Two individuals Settle Insider Trading Charges in Engineered Support Systems Stock

The U. S. District Court for the Eastern District of Missouri entered a Final Judgment by consent against Defendants Matthew E. Kopsky and Ronald W. Davis, resolving charges of insider trading in the securities of Engineered Support Systems, Inc. ("ESSI"). The Court's Judgment enjoined Kopsky and Davis from future violations of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and ordered Kopsky to pay $381,590 in disgorgement and prejudgment interest, and a civil penalty of $276,259, and ordered Davis to pay a civil penalty of $107,062. Kopsky and Davis settled the Commission's claims without admitting or denying the allegations of the Complaint.

The Commission's complaint in this matter was filed on February 26, 2007, and alleged that Davis, ESSI's former President of Business Development, tipped Kopsky, his friend and former broker, prior to each of ESSI's first three quarterly earnings announcements in 2003, and that Kopsky purchased ESSI securities for himself, family members, and clients based upon material, nonpublic information he received from Davis. According to the complaint, Kopsky earned an aggregate profit of $276,259 on these trades, including $107,062 for himself and his wife, and $169,197 for his clients.

As part of the settlement, Kopsky has agreed to a suspension from association with any broker, dealer, or investment adviser, for a period of twelve months, based on the Court's entry of a permanent injunction against him.

http://lawprofessors.typepad.com/securities/2009/02/two-individuals.html

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