Tuesday, August 4, 2015

Richards Layton IT guy tapped Google, Disney deal data

Ex-Richards Layton & Finger manager charged in insider-trading schemes

Richards Layton IT guy tapped Google, Disney deal data


Jeffery J. Temple was information systems and security manager at Richards Layton & Finger, Delaware's biggest corporate law firm, from 2002 until October. 

That put him near the center of the legal mergers and acquisitions business, one of little Delaware's biggest moneymakers, since the state's business-friendly Chancery Court is the preferred dispute resolution center for more than half the Fortune 500 and other Delaware-registered corporations.

Federal investigators say Temple tried to get himself and his family a piece of the action: 

The Securities and Exchange Commission's Philadelphia office yesterday charged Temple and his brother-in-law, Benedict Pastro, with using inside information housed on law firm employer's computers to illegally profit from deals involving his bosses' clients.

Temple "traded in advance of at least 22 prospective mergers and/or acquisition-related announcements," and collected "illegal profits exceeding $88,300." Pastro also traded on at least 12 of the deals, "realizing profits of more than $94,000."

The SEC didn't name the firm, but listed a roster of deals involving Richards Layton & Finger clients, including Google's 2009 offer for On2 Technologies Inc., Disney Inc.'s acquisition of Marvel Entertainment, and Cisco's purchase of Starent Networks Corp., and more than a dozen other transactions..

Richards Layton employees acknowledged Temple worked there, and the firm sent me an email statement. Excerpts: 

  "We confirm that Jeffrey J. Temple is a former employee...
  "The allegations of the complaint, if true, indicate knowing violation" of Richards Layton's confidentiality and stock-trades notification policies.
  "The firm has cooperated fully with the federal government in its investigation, no attorneys or other employees of the firm were involved, and no harm to clients has occurred as a result of the alleged activity..."

Temple and Pastro didn't immediately return calls. SEC says they are brothers-in-law (they are married to sisters) who live in suburban Newark, Del. SEC complaint here.

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About this blog

PhillyDeals posts drafts, transcripts and updates of Joseph N. DiStefano's columns and stories about Philly-area business, which he's been writing since 1989.

DiStefano studied economics, history and a little engineering at Penn and taught writing at St. Joseph's. He has written thousands of columns and articles for the Inquirer, Bloomberg and other media, wrote the book Comcasted, and raised six children with his wife, who is a saint.

Reach Joseph N. at JoeD@phillynews.com, distefano251@gmail.com, 215.854.5194 or 302.652.2004.

Reach Joseph N. at JoeD@phillynews.com or 215 854 5194.

Joseph N. DiStefano
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