This section contains the nature of the case and procedural background.

P filed an Information charging D with securities fraud in violation of 15 U.S.C. §§ 78j(b) and 78ff. D and P executed a plea agreement wherein D pled guilty to securities fraud. D had worked for Diebold, Inc., which manufactures and sells ATMs, bank security systems, and electronic voting terminals. Its common stock trades on the New York Stock Exchange. D was a sales representative in the Oklahoma area and regularly received confidential information concerning Diebold's North American regional bank business. Diebold prohibited corporate employees from trading in Diebold securities when those employees possessed material nonpublic information. D knew of this policy. On July 27, 2005, Diebold announced its second-quarter earnings and provided earnings guidance for the third quarter ending on September 30, 2005. It also provided guidance for 2005 as a whole. After it issued its projections, Diebold's earnings prospects diminished. Diebold sales managers gave Cole and other sales representatives financial reports detailing third-quarter orders and sales information. D learned non-public information -- specifically that Diebold was not meeting its sales targets for either the third quarter of 2005 or for 2005 as a whole. D learned that Diebold's year-to-date revenues from United States regional banks only amounted to 78.8 percent of its target revenues. Other information that Cole received indicated that Diebold would fail to meet its revenue targets. Within days of receiving the non-public information, D began purchasing 'put options' at a total cost of $70,110. Diebold publicly released earnings guidance that suggested lower-than-forecasted quarterly and annual earnings. Diebold reduced its predicted sales to American financial institutions by $ 50 million. Diebold's stock price fell more than 16 percent from the previous day's closing price. D sold all his put option contracts, realizing profits of $509,080. D's put options were investigated, and he disgorged all the profits that he had made. D pled guilty to securities fraud in violation of 15 U.S.C. §§ 78j(b) and 78ff. The Court sentenced D to imprisonment for one year and one day, followed by two years of supervised release. The Court also imposed a $ 180,000 fine, together with a special assessment of $100. The Court explains the reasons for the chosen sentence.

The legal issues presented in this case will be displayed here.

The court's holding and decision will be displayed here.

Legal analysis from Dean's Law Dictionary will be displayed here.