April 10, 2019
A client of Finn Dixon & Herling won a major victory against the SEC after a two-week trial in the U.S. District Court for the District of Vermont. Chad McGinnis, a former web architect at Green Mountain Coffee Roasters in Vermont, traded in Green Mountain securities over the course of multiple years, including around certain of the company’s quarterly earnings announcements. The SEC alleged that Mr. McGinnis must have utilized his position as an administrator of Green Mountain’s intranet sites to access and trade on the company’s material nonpublic information, though the SEC never identified any specific material nonpublic information that Mr. McGinnis accessed or possessed. In support of its theory, the SEC offered the testimony of a purported computer forensics expert, who proffered testimony regarding certain forensic artifacts located on shared computers at Green Mountain. During pretrial proceedings, the Court granted FDH’s Daubert motion to exclude the bulk of the SEC’s forensic expert testimony as unreliable “junk science.” At the close of the two-week trial, McGinnis was cleared of all charges by the jury, which found him not liable on all counts. Mr. McGinnis was represented by Finn Dixon & Herling attorneys Michael Q. English, Evan I. Cohen, and Benjamin M. Arrow.