Wednesday, February 16, 2011
On February 15, 2011, the SEC filed an amended complaint charging a San Diego-based patent agent and his brother with illegally tipping inside information regarding two biotechnology companies, as part of a larger insider trading scheme. According to the amended complaint, Aaron J. Scalia, a former patent agent for Sequenom, Inc., tipped material, non-public information regarding Sequenom and another biotechnology company, to his brother Stephen J. Scalia. Stephen Scalia then tipped his fraternity brother, Brett A. Cohen, who, in turn, tipped his uncle, David V. Myers. Myers traded on the illegally obtained inside information, garnering more than $600,000 in illicit profits, and provided Stephen Scalia with $14,000 in cash kickbacks.
The SEC filed its initial charges in the case in December 2010 against Cohen and Myers. In its amended complaint filed yesterday in federal court in San Diego, the SEC charged the Scalia brothers. In a parallel criminal proceeding, on February 15, 2011, the U.S. Attorney’s Office for the Southern District of California filed criminal charges against the Scalia brothers.