UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 14447 \ March 23, 1995

Securities and Exchange Commission v. Sheri I. Kleinbaum,
Richard A. Kleinbaum, and Jennifer M. Kleinbaum

U.S. District Court for the Southern District of New York,
95 Civ. 1963 (PKL) (S.D.N.Y. 1995).

On March 23, 1995, the Commission filed a complaint alleging
that Sheri I. Kleinbaum, Richard A. Kleinbaum, and Jennifer
M. Kleinbaum engaged in unlawful insider trading that
involved the misappropriation of confidential information
from the law firm of Skadden, Arps, Slate, Meagher & Flom
("Skadden") in violation of Sections 10(b) and 14(e) of the
Securities and Exchange Act of 1934 ("Exchange Act") and
Rules 10b-5 and 14e-3 promulgated thereunder.

According to the Commission's Complaint, between August and
October 1992, Sheri Kleinbaum, by virtue of her employment
with Skadden, learned material nonpublic information
relating to the identity of Sun Electric Corporation and
Heekin Can Corporation as acquisition targets of clients of
the law firm.  In each instance, shortly after learning this
information, Sheri Kleinbaum communicated it to Richard
Kleinbaum and Jennifer Kleinbaum, her father and step-
mother.  Richard and Jennifer Kleinbaum then purchased
shares of common stock of the targets prior to the public
announcements that each was to be acquired, and realized
profits of $60,567.91.  In addition, Jennifer Kleinbaum
communicated material nonpublic information about the
companies to a friend, who in turn tipped others, and
Richard Kleinbaum recommended the securities of the
companies to friends and business associates.  Their friends
and business associates purchased the common stock of the
two companies and realized profits of $701,875.43.

Sheri Kleinbaum, Richard Kleinbaum, and Jennifer Kleinbaum,
without admitting or denying the allegations of the
Complaint, each consented to the entry of a Final Judgment
of Permanent Injunction and Other Equitable Relief enjoining
each from further violations of Sections 10(b) and 14(e) of
the Exchange Act and Rules 10b-5 and 14e-3 thereunder.
Sheri Kleinbaum, Richard Kleinbaum and Jennifer Kleinbaum
each also consented to the entry of a Final Judgment
ordering disgorgement of their and/or their tippees' trading
profits plus prejudgment interest.  Pursuant to the

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settlement, Richard Kleinbaum agreed to disgorge $250,000,
and Jennifer Kleinbaum agreed to disgorge jointly and
severally with her husband $212,995.99 of that amount.  The
Final Judgments do not require Sheri Kleinbaum and Richard
Kleinbaum to make any additional disgorgement of illegal
trading profits based upon sworn representations contained
in their financial statements.  Similarly, based upon their
sworn financial statements, the Final Judgments do not
impose civil penalties against the defendants.



































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