Joseph M. Dupont; Shawn P. Cronin; Stanley Kaplan; Paul Feldman; and Jarett G. Mendoza
U.S. SECURITIES AND EXCHANGE COMMISSION
Litigation Release No. 26209 / January 3, 2025
Securities and Exchange Commission v. Joseph M. Dupont, et al., No. 1:23-cv-05565 (S.D.N.Y. filed June 29, 2023)
SEC Obtains Final Judgments Against Five Defendants in Insider Trading Case
On December 23, 2024, the United States District Court for the Southern District of New York entered final judgments against Joseph M. Dupont, Shawn P. Cronin, Stanley Kaplan, Paul Feldman, and Jarett G. Mendoza resolving the insider trading case filed against them.
The SEC’s complaint, filed on June 29, 2023 alleged that Dupont, who was then a vice president at Alexion Pharmaceuticals, Inc., tipped his close friend Cronin to confidential information about the acquisition of Portola Pharmaceuticals Inc. Cronin then allegedly provided the information to Mendoza and Kaplan, and Kaplan, in turn, provided the information to Feldman. The SEC’s complaint alleged that Cronin, Mendoza, Kaplan, and Feldman used this material, nonpublic information to purchased Portola securities prior to the announcement of the acquisition. The complaint further alleged that Kaplan and Feldman passed information on to other family members and friends, who also profitably traded.
The SEC’s complaint charged all five defendants with violations of Sections 10(b) and 14(e) of the Securities Exchange Act of 1934 and Rules 10b-5 and 14e-3 thereunder. The defendants each consented to the entry of final judgments in the SEC action that provide permanent injunctive relief from the provisions charged in the complaint, as set forth in each judgment, and barred each from serving as an officer or director of a publicly traded company. Dupont was ordered to pay a civil money penalty of $36,000.
Each defendant had previously pled guilty to criminal charges for securities fraud in parallel criminal actions brought by the U.S. Attorney’s Office for the Southern District of New York, United States v. Dupont et al., No. 1:23-cr-00320, and United States v. Mendoza, No. 1:23-cr-00316. Cronin was sentenced to three months’ imprisonment, ordered to forfeit his profits of $71,996.06, and fined $5,000; Kaplan was sentenced to five months’ imprisonment and ordered to forfeit his profits of $472,053.61; and Feldman was sentenced to three months’ imprisonment, ordered to forfeit his profits of $1,730,827.54, and fined $25,000. Mendoza was ordered to forfeit his profits of $38,648.58 and Dupont was fined $75,000.
The SEC’s litigation and investigation were led by Margaret Spillane, Matthew Lambert, and Alison Conn of the New York Regional Office, under the supervision of Thomas P. Smith, Jr. and Daniel Loss. The SEC appreciates the assistance of the U.S. Attorney’s Office for the Southern District of New York, the FBI, and the Financial Industry Regulatory Authority.