Advisor’s Stock Purchase Faulted

A Dallas tax advisor was sued by regulators who say he used confidential information from MiniMed Inc.’s former chief executive to buy shares in the Northridge company shortly before its acquisition by Medtronic Inc. was announced in 2001.

The Securities and Exchange Commission said Thursday that Gary M. Kornman, 61, bought 6,600 MiniMed shares for about $38 apiece in early 2001 after he learned from the CEO that there was a “70% chance” the diabetes-products maker would be bought.

MiniMed’s chief executive at the time was Alfred E. Mann. The SEC didn’t identify him by name or accuse him of wrongdoing. The MiniMed executive “reasonably expected that the information would be kept confidential” given the nature of the tax and estate-planning services Kornman offered, the SEC said.

Mann could not be reached for comment.

Kornman sold his shares for a profit of about $67,000 when Minneapolis-based Medtronic announced in May 2001 that it would buy MiniMed for $48 per share, the SEC said.

Kornman’s lawyer, Jeff Tillotson, said his client planned to “vigorously contest” the allegations.