The Securities and Exchange Commission yesterday filed insider trading charges against a former executive of a Florida corporation who repeatedly traded on and tipped confidential information that he obtained through his employer.
The SEC’s complaint, Petmed complaint filed in the U.S. District Court for the Southern District of Florida, alleges that James Alex Irvin, of Boca Raton, Florida, repeatedly traded in the securities of his employer, PetMed Express, Inc., on the basis of confidential information he obtained as PetMed’s Director of Marketing and a member of its Management Committee. According to the SEC’s complaint, Irvin purchased shares of PetMed common stock and call and put options in advance of six PetMed market-moving earnings announcements while in possession of confidential information concerning the Company’s quarterly and year-end financial results. PetMed’s Insider Trading Policy prohibited trading in PetMed options at any time. Additionally, all of Irvin’s trades at issue took place during blackout periods, when Irvin was expressly prohibited from trading in PetMed stock. As a result, Irvin allegedly realized profits and avoided losses of $227,795. The SEC further alleges that Irvin engaged in insider trading based on tipping confidential information concerning PetMed’s positive fiscal 2017 fourth quarter and year-end financial results to his close personal friend, who made modest profits from his trading.
Without admitting or denying the allegations in the SEC’s complaint, Irvin consented to a permanent injunction prohibiting him from violating the antifraud provisions of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. Irvin also agreed to pay $227,795 in disgorgement, $34,494 in prejudgment interest, and a civil money penalty of $252,270. Irvin further agreed to a five-year officer-and-director bar.
The SEC’s investigation, which is continuing, is being conducted by Jordan A. Cortez and supervised by Jessica M. Weissman and by Glenn Gordon, with the assistance of trial counsel Robert K. Levenson. The SEC thanks the Financial Industry Regulatory Authority for its assistance in this matter. PetMed us an online pet pharmacy in the United States and is publicly traded. It sells prescription and non-prescription pet medications and nutritional supplements. Petmed was founded in Florida in 1996 by Marc Puleo.an anesthesiologist who wanted to open a mail-order business for human prescriptions that also sold pet accessories.
Jeffrey Newman represents whistleblowers including in complaints filed in the Securities and Exchange whistleblower program.