U.S. Securities and Exchange Commission
Litigation Release No. 22085 / September 7, 2011
SEC v. Feinblatt, et al., Civil Action No. 11-CV-0170 (SDNY) (JSR)
Former Trivium Hedge Fund Principal and Analyst Settle Insider Trading Charges
The Securities and Exchange Commission announced today that, on July 18, 2011, the Honorable Jed S. Rakoff of the United States District Court for the Southern District of New York entered a consent judgment against Defendant Robert Feinblatt in SEC v. Feinblatt, 11-CV-0170, an insider trading case the SEC filed on January 10, 2011. Feinblatt was a co-founder and former principal of Trivium Capital Management LLC, a New York-based hedge fund investment adviser that has since wound down its investment management business. Previously, on July 11, 2011, the Court entered a consent judgment against Defendant Jeffrey Yokuty, formerly an analyst who reported to Feinblatt at Trivium.
The Complaint alleged that Feinblatt and Yokuty engaged in insider trading in the securities of Polycom, Hilton, Google and Kronos. The complaint further alleged that a senior executive at Polycom and an employee at Market Street Partners, an investor relations firm that did work for Google, tipped Roomy Khan, an individual investor, to inside information that Khan passed on to Feinblatt and Yokuty. The Complaint alleged that Feinblatt and Yokuty then traded on the basis of this and other inside information given to them by Khan on behalf of Trivium’s hedge funds, reaping illicit profits for the funds of more than $15 million.
To settle the SEC’s charges, Feinblatt consented to the entry of a judgment that: (i) permanently enjoins him from future violations of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder; and (ii) orders him to pay disgorgement of $829,765, plus $186,023 in prejudgment interest, plus a civil penalty of $1,659,530. Yokuty consented to the entry of a judgment that: (i) permanently enjoins him from future violations of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder; and (ii) orders him to pay disgorgement of $127,595.10, plus $34,935.12 in prejudgment interest, plus a civil penalty of $127,595.10.
In separate administrative proceedings, instituted against Feinblatt on September 2, 2011, and Yokuty on July 22, 2011, Feinblatt and Yokuty each consented to be barred from association with any broker, dealer, investment adviser, municipal securities dealer, or transfer agent. Feinblatt may apply for reentry after 5 years and Yokuty may apply for reentry after 3 years.
For further information, see Litigation Release No. 21802 (Jan. 10, 2011).