DALLAS (AP) – Since buying the Dallas Mavericks eight years ago, Mark Cuban has turned the team around and made himself one of the most visible owners in pro sports. Along the way, he’s picked up his share of critics.
Some say he’s a nuisance to the NBA, with more than $1 million in fines held up as evidence. Some Mavs fan say his constant baiting of officials merely leads to more calls against the team. Even his dancing skills have been panned, drawing an early-round ousting from “Dancing With The Stars.”
But now Cuban is facing a much more serious allegation: The government saying he’s an inside trader.
Federal regulators filed a civil lawsuit Monday accusing Cuban of using confidential information to bail out of an investment and avoid about $750,000 in losses. Cuban denies doing anything wrong and insists his name will be cleared.
to it. Cuban isn’t facing criminal charges.
However this plays out, it’s a hit on Cuban’s reputation as the Everyman fan who hit the Internet lottery, became a billionaire and bought his favorite team.
He’ll certainly have to endure a new round of trash-talking from rival fans, even if NBA sanctions are uncertain. The league isn’t commenting, but other owners who’ve brought the NBA shame through personal or professional actions haven’t been punished by commissioner David Stern.
To fans of the Chicago Cubs, this case is likely another strike against Cuban’s chances of buying the club. That is, if he hadn’t already struck out.
While plenty of Cubs fans think an infusion of Cuban’s cash and passion is exactly what the team needs to end its now 100-plus-year championship drought, there have been questions ever since Cuban submitted his bid about whether the exclusive club of MLB owners would allow him to join them. They have the power to keep him out, too, because it takes a three-fourth vote to approve any sale – even if Cuban is the highest bidder and current owner Sam Zell wants to sell to him.
an Cuban.
Lately, reports have indicated Cuban’s offer is no longer being considered, and the lack of response from the baseball world in the wake of Monday’s accusations suggests that Cuban’s case may not matter because he is not an owner-in-waiting.
Eisenberg.
Stern said the SEC rarely picks fights it can’t win. He added that he’s read the complaint and believes it has some strong supporting evidence.
While most cases settle, Stern said there’s been a trend of deep-pocketed defendants going to court to clear their names. “If you settle, you get the one burst of publicity and hopefully in a few weeks everybody forgets about it,” Stern said.
In March 2007, Forbes magazine estimated Cuban’s net worth at $2.3 billion, up from around $1.8 billion near the time of the trade that’s being scrutinized by the SEC. For someone in that financial stratosphere, saving $750,000 doesn’t seem worth the risk of ruining a clean reputation. Yet Stern says it happens all the time.
r trading for $3,000 for someone worth not necessarily billions, but where $3,000 didn’t make a difference one way or another.”
According to the SEC filing, Cuban told his broker to sell all his shares of Mamma.com after the company’s CEO confidentially told him of a stock offering that would dilute the value of Cuban’s existing shares, including Cuban’s. By selling before the information became public and the price fell, Cuban avoided losses exceeding $750,000, the SEC said in its lawsuit.
The SEC also wrote that Cuban became upset and angry during the conversation with the CEO. At the end of the call, Cuban said, “Well now I’m screwed. I can’t sell.”
Cuban’s anger and defiance also were a central theme in a several-year battle over unpaid compensation for Don Nelson, who was the Mavericks’ coach and general manager when Cuban bought the club. Coincidentally, part of Cuban’s defense was that Nelson used “confidential information” to guide the Golden State Warriors to their historic upset of the top-seeded Mavericks in the first round of the 2007 playoffs.
On Sept. 10, a federal arbitrator issued a final ruling of $7.1 million on Nelson’s behalf. As of Tuesday, Cuban had yet to pay.
true, in which case we’re with him 100 percent. But if they are true, he’s lucky he’s not wearing an orange jump suit.”
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