Of course, when the proposed mergers for each of these companies were announced to the public, the value of Kendricks’s options increased considerably.
In the case of Compuware, Kendricks purchased approximately $60,000 in call option contracts, post public merger announcement. Immediately thereafter, Kendricks sold the same call option contracts for approximately $138,000, making a $78,000 profit.
With respect to Move, Kendricks purchased approximately $71,000, and post public merger announcement sold his position for roughly $350,000.
Additionally, regarding Sapient, Kendricks purchased roughly $146,000 in call option contracts and post public merger announcement, sold them for approximately $635,000.
Finally, Kendricks purchased the call option contracts for approximately $446,000 for Oplink and sold them post public merger announcement for about $798,000.
All in all, Kendricks allegedly made a combined gross profit of nearly $1.2 million. The court further alleges that the only things defendant Kendricks gave Sonoiki in exchange for the insider information was tickets to Eagles games and approximately $10,000 in cash.
A Level Playing Field
“At the heart of insider trading cases is the concept of a level playing field,” said Christian Zajac, assistant special agent in charge of the FBI’s Philadelphia division.
