NEW YORK, July 11 (Reuters) - Texas tycoon Sam Wyly and his late brother, Charles, were found not liable for insider trading by a U.S. judge on Friday, two months after a federal jury found them liable for committing fraud by using offshore trusts to hide stock sales.
U.S. District Judge Shira Scheindlin in New York said the U.S. Securities and Exchange Commission had failed to show that the Wylys’ desire to sell a company they controlled, Sterling Software, was material knowledge that could form the basis for insider trading.
Scheindlin is scheduled to preside over a non jury trial in August to determine the amount of damages the Wylys must pay to the government. The SEC has said it will seek up to $553 million, a figure the Wylys have disputed. (Reporting by Joseph Ax; Editing by Bernadette Baum)