Feds dismiss charges against 1 of quartet accused of insider trading on Abbott/AMO buyout

May 7, 2013 by Arezu Sarvestani

Federal regulators drop charges against 1 of the accused charged with insider trading in connection with Abbott's 2009 buyout of Advanced Medical Optics.

money handshake

Federal investigators late last month moved to drop charges against 1 of the quartet of suspects accused of insider trading in connection with Abbott's (NYSE:ABT) $2.8 billion buyout of Advanced Medical Optics in 2009.

Defendant Roger Wittenbach was accused alongside former baseball player Doug DeCinces and 2 others of acting on information allegedly obtained from DeCinces, who investigators said learned of the impending buyout from then-CEO James Mazzo.

Prosecutors suddenly requested a dismissal of the case against Wittenbach late last month, and U.S. District Judge Andrew Guilford approved the motion in short order, although no reason was given for the dismissal.

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Prosecutors in November 2012 indicted DeCinces, Wittenbach and 2 others on criminal charges of insider trading. DeCinces had already agreed to pony up $2.5 million (but admitted no guilt) to settle similar charges leveled by the SEC.

DeCinces allegedly passed the inside information on to 3 of his friends, prosecutors alleged, to make up for bad investment advice he'd given them previously.