The Securities and Exchange Commission’s insider-trading case against Dallas Mavericks owner Mark Cuban has already been a disaster for the agency. But it just might get worse. On Friday, Dallas federal district court Judge Sidney Fitzwater granted a motion by Cuban’s lawyers at Dewey & LeBoeuf to seek discovery from the SEC in connection to their request for attorney fees.
The embarrassing information that could come to light as part of that process would only add salt to the SEC’s wound. In August, Fitzwater dismissed the SEC case with prejudice. While the SEC has appealed that decision, Cuban’s lawyers have pressed for attorney fees, arguing that the SEC did not have a good-faith belief in its case. In his order granting discovery, Fitzwater found that there are “fact issues that remain to be resolved” over Dewey’s motion for attorney fees.
