UNITED STATES SECURITIES AND EXCHANGE COMMISSION
LITIGATION RELEASE NO. 18023 / March 10, 2003
SECURITIES AND EXCHANGE COMMISSION v. JOHN C. LARRABEE, Civil Action No. 97-10652-PBS (D. MA.)
DISTRICT COURT JUDGE GRANTS MOTION FOR SUMMARY JUDGMENT AGAINST FORMER LAW FIRM EMPLOYEE FOR INSIDER TRADING
The Securities and Exchange Commission announced that on June 11, 2002, U.S. District Court Judge Patti Saris granted the Commission's Motion for Summary Judgment against John C. Larrabee ("Larrabee"), the former Director of Fiduciary Services at the law firm of Bingham, Dana & Gould, which is now known as Bingham McCutchen, LLP ("Bingham"). Also on June 11, the Court entered a final judgment against Larrabee for insider trading that permanently enjoined him from future violations of Section10(b) of the Securities Exchange Act of 1934 and Rule 10b-5, thereunder.
On March 25, 1997, the Commission filed an insider trading complaint against Larrabee and James L. D'Angelo ("D'Angelo") in the United States District Court for the District of Massachusetts. The complaint charged that in early December 1995, Bank of Boston retained Bingham to represent it in connection with its confidential proposed merger with BayBanks. The indictment alleged that Larrabee learned of the pending deal, and on the afternoon of December 12, 1995, tipped D'Angelo. D'Angelo promptly purchased $870,048 worth of Baybanks stock in eight accounts that he and his family controlled and in a ninth account in the name of his girlfriend. Bank of Boston and BayBanks publicly announced the merger that evening. The next morning, D'Angelo sold all of the stock for an $86,750 profit.
D'Angelo previously consented to a permanent injunction against future violations of the securities laws, and paid disgorgement of $86,750, plus prejudgment interest in the amount of $8,552 and a civil penalty of $86,750, for a total of $182,052. In addition, D'Angelo agreed to a Commission order barring him from association with any broker, dealer, municipal securities dealer, investment adviser or investment company.
D'Angelo and Larrabee previously were convicted of nine counts of securities fraud each for their insider trading in the stock of BayBanks. Each was sentenced to 1 year and 9 months in prison. In addition, Larrabee was fined $20,000 and D'Angelo was fined $5,000.