“I’m glad I’m able to be the person who can afford to stand up to them. I don’t want anything from the SEC; except them to act like American citizens and treat other American citizens the way they deserve to be treated.” Mark Cuban
“The YouTube video below of Mark Cuban outside the courthouse after his victory over the SEC is a must watch. It especially resonates with me. In my case, I had to spend several years of my life defending the matter. In the end, every SEC allegation, except one, was dismissed on summary judgment as a matter of undisputed fact and the law. A single negligence disclosure allegation remained against me, where the facts needed to be heard at trial. The insurers were improperly denying me further insurance coverage for my legal expenses so I settled that remaining negligence claim. In doing so, I neither admitted nor denied a single negligence disclosure allegation, paid an $80,000 fine, and agreed to an injunction to not violate the securities laws in the future (I remain eligible to serve as an officer and/or director of any public company). The court rulings in my case speak for themselves. I agree with every word Mr. Cuban says about the SEC.” Mike Perry, Former Chairman and CEO, IndyMac Bank
Reporter: …people are going to be suspicious…
Mark Cuban: That’s why you have to look at the facts. If you go through, and you read it, you’ll see that…look, they could have called me…I bought the shares March 2nd, they could have called me to tell me about this any time. They didn’t. Right? If you go back and read the testimony they talk about wanting to tie my hands. Right? They did. Right? There’s just so much to it, right? But the bottom line is they could have handled it 101 different ways, they could have handled it honestly and they didn’t. Right? This was a company with something to hide.
Reporter: Would they have hanged on to this case if it hadn’t of been Mark Cuban?
Mark Cuban: You’ll have to ask them.
Reporter: This has been hanging over your head for nine years. Describe the moment when you started hearing that you were not being found liable in this case. The relief.
Mark Cuban: You know…it never was like that. Right? Guilty or innocent, this…I mean obviously I wanted to win, but at the same time…like I said, I didn’t win anything. Right? The fact that someone, Janet Folina and Christian Schultz can sit up there and just tell lies and lies, and deceit…it’s just wrong. I…there was no point in time where I sat there and listened to it and felt ‘you know what, winning will feel good.’ That’s just not the way things should be. And, you know, you talk about Mary Schapiro…wait, is it White or Schapiro now? Mary Jo White, the new head of the SEC, talking about a broken window policy? She needs to think things through. Because one of the problems we saw here in the trial that the SEC has is, there’s no ‘bright line’ rules. You guys have got to ask what insider trading is. You’ve got to ask…any securities rule.
You can’t just call up the SEC and say ‘I want clarification on this, tell me.’ Right? That won’t do it. Right? They regulate through litigation. And that’s its own problem. So for Mary Jo White to sit out there ‘oh we’re going to have a broken window policy, well we’ll go after little offenders,’ little offenders? If you’re going to bust a window, you can call the cops and ask is it illegal to bust a window. There’s no little guy around here who’s going to be able to call the SEC and say ‘look, I have a problem, I need a question answered. Am I allowed to do this?’ They’ll ignore you. And those are the exact little people that Mary Jo White said she is going to pick on to send her message. Right?
So, hopefully, hopefully the start of this (sic) is that people will start paying attention to how the SEC does business. I’m the luckiest guy in the world. I’m glad this happened to me. I’m glad I’m able to be the person who can afford to stand up to them. I’m glad I don’t need anything from them. I don’t want anything from the SEC…except them to act like American citizens and treat other American citizens the way they deserve to be treated. Because this was a horrific example of government does work. Let me re-phrase that. There’s a lot of great people in government, I don’t want to generalize. I don’t want to generalize about the SEC. I’m sure there’s a lot of good people.
There were people on their side saying ‘look, it’s only business, it’s not personal.’ Janet Folina is like ‘hey, this is only business, I’m just here to litigate,’ Dwayne was like ‘hey, tell your friend Charlie that it wasn’t personal, it’s just business.’ It’s personal! When you put someone on the stand and accuse them of being a liar, it’s personal. Right? When you take all these years of my life, and try to prove a point, it’s personal. And to try and play off like this is just your job? Again, I don’t want to say that’s the way all the SEC works, but the people who were in this case could have said something, and didn’t say anything, and that’s just wrong.
Reporter: The fact that some of the evidence, a lot of the evidence, was stuff that you had turned over yourself voluntarily, and then they used it against you (Cuban nodding). How do you react to that?
Mark Cuban: So what? The facts are the facts, right? I had nothing to hide. I didn’t have anything to hide in 2004, I have nothing to hide today. That’s why I turned it all over, that’s why I voluntarily spoke to everyone. I had no issues, I had nothing to hide. I mean…if anything…literally mamma.com, inside…the execs at mamma.com insider traded. It’s all on the record, and they wouldn’t let us enter…they wouldn’t let us use it. Right? They ignored them. Mamma.com pulled an amazing fraud, amazing…horrific fraud, on the pipe investors. They misled them. You heard David Goldman in there talk about their business falling off a cliff, or words to that effect. They didn’t go after mamma.com, because it wasn’t a big name. You know, it’s just…again, I don’t want to generalize to the SEC, I’m sure they have a lot of great people, the government has a lot of great people who serve this country, but what Janet Folina and Christian Schultz did…that was their choice. Their choice of words. When they called people that are upstanding citizens liars. When they mischaracterize the facts. When they did everything to hide the facts, and not bring out the facts. That’s just wrong. And someone’s got to stand up and do that…and like I sad, when this started I won’t be bullied. I don’t care if this is the United States Government. And I don’t (sic) win anything today, I just got started today.
Reporter: You said before that you could afford to stand up to a bully. A lot of people are wondering, to make that point, did you spend more on this legal team than you would have been fined?
Mark Cuban: Oh, far more. Not even close.
(laughter – ‘it was well worth it’ from the crowd)
Reporter: I saw you on the phone inside. Who’d you call and what’d you say? What was your first call?
Mark Cuban: Family.
Reporter: Can you tell us what you said?
Mark Cuban: Nope.
Reporter: Is this political at all, in any way?
Mark Cuban: I don’t think so. Because, you know, it was brought in 2006 by a lady named Linda Thompson, who works at Davis and Polk, and if you hire her, in my opinion, you get everything you deserve. Um…and, who knows what her motivation was. There’s literally pictures of her…there’s…they had pictures of me, when the SEC was discussing the case, they had pictures of me from that old show I did ‘The Benefactor?’ Like one of the promotional pictures was me holding a big stack of money? And literally, they passed it around and said, ‘this is all I need to know, this says everything.’
Reporter: Were you at all surprised that about 3 ½ hours without lunch, for this jury about this particular situation?
Mark Cuban: I had no idea what to expect there.
Reporter: Will this change the way you trade?
Mark Cuban: No. I never did anything wrong in the first place. I have great brokers, I mean I’ll follow…look I am so squeaky clean for reasons…I know I’m going to be a target, right? I mean, we started to cross the street, I’m like ‘nope, that’s jay walking, let’s walk back up and go over.’ You know, it’s just, I recognize that when I do things, people pay attention. For better or worse, that’s been my choice, and that’s where I am. But, like I said, I…you know…you can bully me, and it’s up to me to deal with it…Part of my hope is that this obviously will go on the record, this will be online for ever more, and so when Janet Folina goes to have someone else on the stand, they’ll know what to expect. That she’s going to try to bully them, that she’s going to try to mislead them, she’s going to mischaracterize information, she’s going to mis-quote information, and hopefully they’ll be ready for it. And when Christian gets out there, hopefully next time he’ll know what he’s talking about. (shrugs) And he won’t post on Facebook.
Reporter: How ‘bout those Mavs?
Mark Cuban: How ‘bout the Mavs! I’ve got a game to watch.