Judge Jed Rakoff entered Final Judgments in Consent of the SEC insider trading cases against Mark Anthony Longoria and Donald Longueuil.  The SEC filed its complaint on 2/3/11, charging 2 expert network employees and 4 consultants with insider trading. Longoria, a Supply Chain Manager at Advanced Micro Devices (“AMD”), was privy to confidential information about AMD’s internal sales figures for the company’s various operational units;  he also paid a friend for additional "top line” quarterly revenue and profit margin information for AMD.   Longueil was a managing director at Empire Capital Management LLC. SEC Allegations. The SEC charged a NY-based hedge fund and 4 hedge fund portfolio managers and analysts who illegally traded on confidential information obtained from technology company employees moonlighting as expert network consultants.  The scheme netted more than $30 million from trades based on material, nonpublic information about such companies as:  AMD, Seagate Technology, Western Digital, Fairchild Semiconductor, Marvell Technology Group.

The charges were the first against traders in the SEC's ongoing investigation of insider trading involving expert networks.

From 2006 to 2010, Longoria regularly provided Primary Global Research LLC (“PGR”) and PGR clients with AMD inside information that he was privy to or obtained from his friend. The tippees then used the information to trade securities.  Longoria was paid $179,000 in total. In May 2008, Longueuil received material nonpublic information re: an earnings report about to be issued by Marvell.  He received this information from co-defendant Noah Freeman, who had received the information from co-defendant Winifred Jiau, a paid consultant at PGR.  Jiau herself had received the information from a Marvell employee. Longueuil used the information to purchase more than 800,000 shares of Marvell stock.  Days later, when Marvell announced better-than-expected quarterly results, Empire sold the holding for more than $2.5mn in profits. SEC Sanctions. Longoria was ordered to pay $197,000 in disgorgement and prejudgment interest.  He also was permanently barred from acting as an officer or director of a public company.  No civil penalty was issued because Longoria agreed to cooperate with the SEC. Longueuil was ordered to pay  $353,000 in disgorgement and prejudgment interest.  No civil penalty was issued because Longueuil agreed to cooperate with the SEC.  The case is ... SEC v. Mark Anthony Longoria, et al., Civil Action No. 11-CV- 0753 (SDNY) (JSR). [SEC Litigation Release 22153, 11/15/11]