U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 22613 / February 6, 2013
Securities and Exchange Commission v. Harrold, Civil Action No. CV 12-1959 GW(JCx)
STEVEN HARROLD SETTLES SEC INSIDER TRADING CHARGES
On January 22, 2013, the U.S. District Court for the Central District of California entered a final judgment by consent against Steven Harrold in the SEC’s enforcement action which charged Harrold, a former executive at a Coca-Cola bottling company, with insider trading based on confidential information he learned on the job about a transaction with The Coca-Cola Company. The final judgment enjoins Harrold from future violations of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5(a) and (c) thereunder. The Court also ordered Harrold to pay disgorgement of $86,850, prejudgment interest of $8,954.22, and a civil penalty of $86,850, for a total of $182,654.22 in monetary sanctions. In addition, the final judgment bars Harrold from serving as an officer or director of a public company. Harrold consented to the entry of the final judgment without admitting or denying any of the allegations of the Commission’s complaint.
According to the Commission’s complaint filed March 8, 2012, Harrold, who was a Vice President at Coca-Cola Enterprises Inc. (ticker symbol: CCE), purchased company stock in his wife’s brokerage account after learning that his company had agreed to acquire The Coca-Cola Company’s (ticker symbol: KO) bottling operations in Norway and Sweden. The SEC alleges that Harrold, who lives in Los Angeles and London, was informed in early January 2010 that CCE was considering the acquisition of KO’s Norwegian and Swedish bottling operations in a transaction internally valued at more than $800 million and viewed as creating significant positive growth opportunities for CCE. Harrold signed a non-disclosure agreement requiring him to maintain the confidentiality of any nonpublic information he learned about the potential transaction. Harrold also received an e-mail from CCE’s legal counsel informing him that he was subject to a blackout period and was prohibited from trading in CCE stock “until further notice.” The SEC alleged that Harrold purchased 15,000 CCE shares in his wife’s brokerage account on Feb. 24, 2010, the day before the announcement of the transaction with KO. CCE’s stock price jumped over 30 percent when the deal was announced publicly the following day, enabling Harrold to make an illicit $86,850 profit.
For more information about this matter, see Litigation Release No. 22280 (March 8, 2012).