A federal judge in New York threw out the Securities and Exchange Commission’s lawsuit against Siebel Systems Inc., dealing a setback to regulators’ drive to ensure that companies share key information with all of their investors, not just favored clients and analysts.
In the lawsuit filed last year, the SEC accused the software company, Chief Financial Officer Kenneth A. Goldman and Vice President Mark D. Hanson of violating fair-disclosure rules that bar senior executives from sharing material nonpublic information with selected clients likely to use it to buy and sell stock.
Siebel argued that the information its officials provided in two meetings on April 30, 2003, was neither private nor important enough to trigger the SEC rule. Goldman allegedly told investors that the San Mateo, Calif., company’s sales were “good” and its deal pipeline was “growing.” Those statements contrasted with more downbeat comments from Siebel’s top executive in conference calls and speeches earlier that month, regulators argued.
