U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 17777 / October 8, 2002
SEC v. Terry L. Kirch, (U.S.D.C. N.D. Ill., Civil Action No. 02C-7195 (MIS/MCA) filed October 7, 2002).
Member of CEO Executive Roundtable Charged with Insider Trading
The U.S. Securities and Exchange Commission ("Commission") announced that yesterday it filed a complaint in the United States District Court for the Northern District of Illinois alleging that Terry L. Kirch ("Kirch"), a software executive, misappropriated confidential information from an executive of another company at an executive roundtable conference. In its complaint, the Commission alleges that on or about October 1, 1999, Kirch, a then Chief Executive Officer ("CEO") of a private software company, attended a meeting in Westport, Connecticut of software executives from various companies ("Executive Roundtable.") This group consists of about ten software organizations or former software organizations that meets twice a year to discuss ideas and strategies. It was the policy and fundamental understanding of the Executive Roundtable that matters of a confidential or sensitive nature were to be kept confidential. During this meeting, ShowCase Corporation's ("Showcase") CEO made a presentation at the roundtable disclosing that ShowCase would not meet analysts' projections for the second quarter. Shortly after this presentation, Kirch called his broker and placed an order to sell certain of his shares of ShowCase. By selling when he did, Kirch avoided losses of approximately $45,688. The Complaint seeks an injunction, disgorgement plus prejudgment interest and a civil penalty. The Commission acknowledges the assistance of the National Association of Securities Dealers in this matter.