Eventually, history did repeat itself, as Cigna announced its intent to terminate its contract in August 2021, leading stock prices to again plunge more than 40%, Sentilles said. Armed with material, nonpublic information, Peizer essentially established his Rule 10b5-1 trading plans in August and May 2021, and quickly shed over 600,000 shares worth over $20 million, avoiding losses of approximately $12 million, jurors heard.
Peizer falsely certified in both 10b5-1 trading plans he had no material, nonpublic information, jurors were told, and also refused to utilize a “cooling-off period” — which is a specified time frame in which an executive waits a certain number of days to set up a plan to start trading — as he knew Cigna could end its deal with Ontrak at any time.
Sentilles promised that jurors would hear from former Ontrak employees who will testify that Cigna had problems with Ontrak, and that Cigna started cutting down the number of its members, from several thousands per month to approximately 50 per month, at the time things only got worse from there.
