U.S. Securities & Exchange Commission
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U.S. Securities and Exchange Commission

Washington, D.C.

LITIGATION RELEASE NO. 17059 / July 5, 2001

SECURITIES AND EXCHANGE COMMISSION v. JACK S. SILVER, Case No. 01 Civ. 6038 (Judge Pollack) (U.S.D.C., S.D.N.Y.)


On July 5, 2001, the Commission filed a settled case in the United States District Court for the Southern District of New York against Jack S. Silver, an investor in New York City. The complaint charges Silver with filing untimely and misleading reports concerning his beneficial ownership of stock in TransAct Technologies, Inc., his unsuccessful efforts to negotiate an acquisition of TransAct, and his subsequent divestiture of his TransAct holdings. Without admitting or denying the Commission's allegations, Silver consented to entry of a final judgment that would enjoin him from violating Sections 10(b) and 13(d) of the Securities Exchange Act of 1934 and Rules 10b-5, 13d-1, and 13d-2 thereunder, and order him to pay a $50,000 civil penalty.

In late March 1997, according to the Commission's complaint, Silver acquired more than 5% of the outstanding common stock of TransAct, a company based in Wallingford, Connecticut that trades on the Nasdaq National Market. The complaint alleges that Silver was approximately four months late in filing with the Commission a required statement on Schedule 13D to disclose his acquisition of TransAct stock, and that Silver's statement, when filed, failed to disclose several material facts that Silver was required by law to disclose, including his active and ongoing efforts to convince another company to acquire TransAct. The complaint further alleges that, after failing in his efforts to negotiate an acquisition of TransAct, Silver sold his entire position of more than 550,000 shares of TransAct in the open market between late August and late October 1997, but failed to make required disclosures of those sales until November 13, 1997, approximately 2 months late. According to the complaint, Silver's untimely public disclosure of his sales took on added significance because, during the period when Silver was selling his shares at prevailing market prices, Business Week published an "Inside Wall Street" column which, based on interviews conducted months earlier, quoted Silver as predicting that TransAct was likely to be acquired at a premium over market price. Thus, the complaint alleges, Silver's undisclosed sales occurred at a time when the news media were raising hopes of a potential acquisition of TransAct at a premium, which Silver knew would not occur.


Modified: 07/09/2001