The complaint further alleges that Cuban knew that the offering would be conducted at a discount to the prevailing market price and that it would hurt existing shareholders. After Cuban received this information, the complaint holds that Cuban called his broker and told him to sell his stake in the company. This move enabled Cuban to avoid losses in excess of $750,000. “It is fundamentally unfair for someone to use access to nonpublic information to improperly gain an edge on the market,” said Scott Friestad, deputy director of the SEC’s enforcement division, in a statement.
-- Winter Casey

Update: Cuban responded to the claims by posting a statement on his blog. "I wish I could say more, but I will have to leave it to this, and let the judicial process do its job," he said. Follow the jump to read the statement by attorney Ralph Ferrara.