SEC v. Cary: Accounting Consultant Charged with Insider Trading

In SEC v. Cary, No. 8:17-cv-01649, 2017 (C.D. Cal. Sept. 21, 2017), the United States Securities and Exchange Commission (“SEC”) filed a complaint against Justin Samuel Cary (“Cary”) in the United States District Court for the Central District of California for alleged violations of the Securities Exchange Act Section 10(b) (“§ 10b”) and Rules 10b-5(a) and 10b-5(c) promulgated thereunder.

According to the complaint, Cary, a certified public accountant, worked as a consultant for NOW CFO, an accounting outsourcing firm.  NOW CFO placed Cary as a consultant with Adaptive Medias from March 2013 through March 2016.  Cary prepared financial statements for Adaptive Medias that were filed with the SEC, and acted as Adaptive Medias’ point of contact for its independent auditors.

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Case SummariesSean CuffSean Cuff
No-Action Letter for Apple Inc. Permitted Exclusion of Policy to Keep Doors closed when Climate Control in Use.

In Apple Inc., 2017 BL 446883 (Dec. 12, 2017), Apple Inc. (“Apple”) asked the staff of the Securities and Exchange Commission (“SEC”) to permit the omission of a proposal submitted by Sustainvest Asset Management, LLC (“Shareholder”) requesting Apple produce a report assessing the climate benefits and feasibility of adopting a store-wide policy to keep entrance doors closed when climate control is in use. The SEC issued the requested no action letter allowing for the exclusion of the proposal under Rule 14a-8(i)(10).

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No Action LettersCarlos SchidlowCarlos Schidlow
No Action Letter for ITT Inc. Permitting Exclusion of Shareholder Proposal

In ITT Inc., 2017 BL 84441 (March 16, 2017), ITT Inc., (“ITT”) asked the staff of the Securities and Exchange Commission (“SEC”) to permit ITT to omit a shareholder proposal submitted by John Chevedden (“Shareholder”) requesting that ITT place a proposal on ITT’s proxy statement permitting a group of up to 50 shareholders to aggregate their shares to equal 3% of ITT stock owned continuously for 3-years in order to make use of shareholder proxy access. The SEC issued the requested no-action letter permitting ITT to exclude the proposal under Rule 14a-8(i)(10).

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No Action LettersSean CuffSean Cuff
Dinnen v. Kneen: Defendants' Motion to Dismiss Claims in Amended Complaint Granted.

In Dinnen v. Kneen, No. 16-cv-00882-PAB-STV, 2017 BL 332704 (D. Colo. Sept. 19, 2017), the United States District Court for the District of Colorado granted PdC, LLC, Timothy Kneen, Michael Roberts, Timothy Flaherty, and Carl Vertuca’s (“Defendants”) Motion to Dismiss, finding that Michael W. Dinnen’s (“Plaintiff”) Amended Complaint failed to sufficiently allege scienter in the Section 10(b) claim under the heightened pleading requirements of the Private Securities Litigation Reform Act (“PSLRA”). 

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Shareholder ActionsCarlos SchidlowCarlos Schidlow