U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 16482 / March 23, 2000
Securities and Exchange Commission v. Parvin Gidvani, Civil Action No. H-00-1013 (S.D. Tex. March 23, 2000)
SEC Charges Parvin Gidvani, Former Employee of Owen Healthcare, Inc.,
With Insider Trading
The Securities and Exchange Commission today filed a Complaint in the United States District Court for the Southern District of Texas against Parvin Gidvani ("Gidvani"), a resident of Houston, Texas and a former employee of Owen Healthcare, Inc. ("Owen"). The Commission alleges that Gidvani illegally bought Owen stock ahead of a November 27, 1996, announcement that Owen and Cardinal Healthcare, Inc. ("Cardinal") had signed a definitive merger agreement in which Owen would become a wholly owned subsidiary of Cardinal.
Specifically, the Commission alleges:
During the course of Gidvani's employment with Owen, he had access to material, nonpublic information concerning the acquisition of Owen by Cardinal. While Gidvani was in possession of that information, he purchased 2,000 of shares of Owen for $27,000. He then sold the shares after the announcement and realized illegal profits of $23,500.
Gidvani also recommended Owen to two of his friends. The two friends also purchased shares in Owen prior to the announcement and sold their shares afterwards. They realized profits of $41,250 and $39,750, respectively.
The Commission charged Gidvani with violating Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The complaint seeks disgorgement of all illegal profits, including the profits of the two friends, the imposition of civil monetary penalties and permanent injunctive relief.
The Commission's investigation in this matter is continuing.