Insider Trading

Devon Vogels purchased 270 shares of Comcast in the weeks prior to its acquisition of Time Warner. Within the nine days following the announcement of the acquisition, he sold all of his shares, amounting to a total of $97,000, a 400% return on his investment.

Devons brother, Roger Vogel was employed by a law firm working on Comcasts acquisition of Time Warner. Roger had confidential information about the deal, including that Comcast would pay $50 per share for Time Warner and that the deal would be announced by Labor Day.

Roger had mentioned to Devon that he was working on a big project, but he denied ever giving Devon details about the acquisition. Devon had access to Rogers computer and could have accessed electronic documents related to the acquisition and pieced together the companies involved and the timing of the acquisition.

Devon denied any wrongdoing. He said that he had frequently been involved in the stock market and was simply trading shares normally as he had done before and got lucky.

The SEC obtained Roger's computer and is aware that Devon had searched the internet for the terms insider trading, material, non-public information, and Rule 10b-5 shortly before buying the stock. Devon said that he was simply curious about the terms.

Devon wants to know if he is likely to be convicted of a crime?

You may consider and refer to SEC v. Scammel, 2011 WL 3506153 (C.A.C.D. Aug. 11, 2011) or other relevant authority in your memorandum.

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