Baseball Hall of Famer Eddie Murray agreed to pay $358,151 to resolve U.S. claims that he profited from an insider-trading tip provided by former Baltimore Orioles teammate Doug DeCinces.
Murray made $235,314 on the $1.36 billion acquisition of Advanced Medical Optics Inc. by Abbott Laboratories (ABT:US) Inc. in 2009 when given advance information about the deal, alongside others who have settled with the Securities and Exchange Commission or face claims, the agency said in a statement yesterday. DeCinces and three others agreed to pay $3.3 million last year to settle SEC claims they reaped a total of $1.7 million, the agency said.
DeCinces’ neighbor, James Mazzo, then-chairman and chief executive officer of Santa Ana, California-based Advanced Medical Optics, told DeCinces that Abbott was making a tender offer for his firm, the SEC alleged.
Mazzo, 55, and another friend of DeCinces, David L. Parker, 60, who lives in Provo, Utah, and is a managing partner at an Irvine, California-based private-equity firm, face insider trading claims filed by the SEC yesterday in federal court in California.
“Mazzo had repeated personal contacts and communications with DeCinces, who promptly traded and tipped Murray, Parker and others that a deal involving Mazzo’s company was imminent,” Daniel M. Hawke, chief of the SEC Enforcement Division’s Market Abuse Unit, said in the agency’s statement. “CEOs and other employees of public companies must resist the lure of sharing confidential information with their friends and always put the interests of their shareholders and company first.”
Murray, one of baseball’s greatest hitters, logged the most career RBIs among switch hitters during his 20-year career, according to the National Baseball Hall of Fame website. He was inducted into the Hall of Fame in 2003 as only the third player to collect both 3,000 hits and 500 home runs.
The former first baseman, who also earned the Gold Glove Award three years running, maintained a close friendship with DeCinces, 61, after they stopped playing together in 1981, the SEC said.
“Eddie Murray is admitting no wrongdoing at all in this matter,” Michael Proctor, Murray’s lawyer in Los Angeles, said in an e-mail. “What I can say is that Mr. Murray, a decent man of principle and accomplishment, has settled this to put the matter to an end and get on with his life.”
Mazzo and DeCinces were friends in Laguna Beach, California, socializing at the same Orange County country club and sharing overseas vacations, the SEC said. DeCinces bought 90,700 shares of Mazzo’s company in the days leading up to its purchase, according to the SEC complaint, including in accounts set up for his grandchildren. He also called Murray repeatedly during that period, including once from a golf course.
“Mr. Mazzo flatly and unequivocally denies the SEC’s allegations,” said Richard Marmaro, his Los Angeles lawyer, in an e-mailed statement. Marmaro said it was “preposterous” to think Mazzo would risk his reputation “for no apparent reason.” He said his client “never disclosed material, non- public information to anyone -- not to give a trading advantage to a friend, not for any reason.”
James Sanders, a Los Angeles lawyer for Parker, declined to comment on the accusations that Parker pocketed $347,920 from the tips.
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