UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 17349 / January 31, 2002
SECURITIES AND EXCHANGE COMMISSION v. FLOYD P. GOODSON, JAMES F. GOODSON AND JOHN R. FISER, United States District Court for the Northern District Georgia, Case No. 1-99-CV-2133 (MHS)
The Securities and Exchange Commission ("Commission") announced today that following a four-day trial of its insider trading claims against defendants Floyd P. Goodson ("Floyd G."), his father James F. Goodson ("James G.") and a family friend, John R. Fiser ("Fiser"), an eight-person jury rendered verdicts in defendants' favor.
The trial involved allegations that Floyd G. misappropriated information learned from his wife, Amy Goodson, about a planned acquisition of her employer, VeriFone, Inc. ("VeriFone"), by the Hewlett-Packard Company ("Hewlett-Packard") in April 1997. The Commission filed its complaint in the Northern District of Georgia, Atlanta Division, on August 19, 1999.
According to the Complaint, Amy Goodson learned of the impending acquisition of VeriFone by Hewlett-Packard during a VeriFone corporate retreat. That night, concerned about the possible impact the acquisition would have on her career, Amy telephoned Floyd G. and told him about the acquisition and her career concerns. Floyd G. then telephoned his father, James G., and informed him of the pending acquisition. Hours later, James G. purchased VeriFone option contracts. The Complaint further alleges that James G. also promptly telephoned Fiser and told him of the acquistion. Fiser quickly began purchasing VeriFone option contracts.
On April 23, 1997, Verifone announced that it would be acquired by Hewlett-Packard. That news caused VeriFone's stock price to increase nearly 57%, rising from $30 1/8 at the close of trading on April 22, 1997 to $47 1/4 at the close of trading on the day of the announcement. Both James G. and Fiser sold their option contracts immediately after the announcement, reaping one-day profits of $62,374 and $146,907, respectively.
The jury trial began on Monday, December 3, 2001, before Judge Marvin H. Shoob in the United States District Court for the Northern District of Georgia. Evidence was presented to the jury from December 4, 2001 through December 6, 2001 through videotaped depositions and live witnesses. Following closing arguments and instructions by the Court, the jury deliberated four hours during the afternoon and early evening of Friday, December 7, 2001. The eight-member jury then delivered general verdicts in favor of each of the three defendants.