Closing arguments are set for Tuesday, October 15th, in the Securities and Exchange Commission (SEC) insider trading case against flamboyant billionaire, Mark Cuban, owner of the NBA's Dallas Maverick's. In 2008, the SEC charged Cuban with insider-trading for the sale of $7.9 million in stock of Canadian Internet company Mamma.com. The SEC alleges that his trade saved him $750,000 in losses nine years ago.
Typically, most wealthy people allegedly caught with their hand in the cookie jar eventually settle. However, Mr. Cuban -- who grew up in a blue-collar home and became a self-made billionaire -- isn't known to kowtow to anyone, even if it is the federal government.
At first blush, it would seem to make sense for Cuban to settle. These cases are time-consuming, distracting, and risky. Not only is there the chance that Cuban's reputation will be damaged, there is the risk of the unknown: the costs of contesting the case and the potential for a large loss due to a verdict that goes against Cuban could far surpass a pre-trial settlement. But Cuban vehemently professes his innocence and has rejected any talk of settlement. So, is it crazy that he wants to prove his innocence?
Fortunately, for Cuban, he has the means to go up against the $17 trillion dollar gorilla. However, for the vast majority targeted by the government who lack resources to put up a stalwart defense, a trial can turn catastrophic.
"I did nothing wrong and I refuse to be bullied," Cuban told the press.
For over two days, Mr. Cuban was called as a witness by the SEC. He certainly should have been well prepared for the chess match and theatrics of a high-profile trial. Yes, he is ably represented by the best attorneys his money can buy, but his real edge as an effective witness stems from his business experiences and from starring on ABC's hit show, Shark Tank.
Cuban's success is rooted in his confidence, but that confidence also has brought out a lot of haters. Apparently, that includes the SEC, which has dug in its own institutional heels and is determined to fight.
I know a lot about settling and fighting with the federal government. In 2007, I pled guilty to a felony stemming from my pathological gambling addiction. I knew I was wrong and it was actually liberating to come forward.
However, I have also had other matters before the government and have been astonished by what government officials can get away with. Because of the injustices I have suffered at the hands of unscrupulous prosecutors, I understand how a person like Cuban, who believes he has been unjustly persecuted or prosecuted will go to the end of the Earth to tell his story.
Could Cuban just be another case of an entitled billionaire who believes he is above the law? Anything is possible, but more likely, Cuban simply believes he is innocent and he is willing to pay to prove the point. You have to respect somebody who is willing to take a big risk to vindicate himself. After all, they say innocent people shout it out loudly. Cuban is certainly doing so.
It's too bad the cost of proclaiming you're innocence in an American court of law can be so prohibitively high for most of us. No matter the outcome, I'm certainly glad Mr. Cuban didn't say, "I'M OUT!!!"