U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 19514 / December 22, 2005
Securities and Exchange Commission v. Gregory N. Champe, Case No. 1:05CV02445 (Friedman, J.) (D.D.C. filed December 22, 2005)
SEC Charges Martek Executive with Insider Trading
The Securities and Exchange Commission today filed civil insider trading charges against Gregory N. Champe, an executive of Martek Biosciences Corporation, a publicly-traded company headquartered in Columbia, Maryland. The SEC's Complaint, which was filed with the United States District Court for the District of Columbia, alleges that after the close of the market on April 27, 2005, Martek announced publicly that it expected revenues for the next two quarters to be significantly lower than previously forecast. The closing price of Martek's common stock plummeted on this news from $60 per share on April 27 to $32.50 on April 28, 2005, a one day stock drop of 46 percent. According to the Complaint, Champe sold 2,600 shares of Martek common stock on April 26 -- the day before the negative news announcement -- on the basis of material, nonpublic information concerning the company's revenue forecast, thereby avoiding a loss of $71,552. Without admitting or denying the allegations of the Complaint, Champe consented to a final judgment permanently enjoining him from violations of Section 10(b) of the Securities Act of 1934 and Rule 10b-5 thereunder and ordering that he pay $54,825 in disgorgement. The proposed final judgment does not impose any additional monetary sanctions based upon Champe's demonstrated inability to pay.
SEC Complaint in this matter