Judge Tosses Out Insider Trading Case

J. Thomas Talbot, the Orange County businessman and former director of the title insurance giant Fidelity National Financial Inc. who was accused of insider stock trading in 2004, has been cleared of the civil allegations by a federal judge in Los Angeles.

U.S. District Judge Margaret Morrow on Tuesday threw out the case, ruling that Talbot did not violate securities laws because he owed no duty of confidentiality to LendingTree Inc., the original source of the information at issue.

Talbot bought and sold shares of LendingTree in 2003 after hearing at a Fidelity board meeting that the online lender would be acquired at a hefty premium, the Securities and Exchange Commission claimed in its suit.

In April 2003, Fidelity’s chief executive told the board that LendingTree would soon be bought, the SEC said. At the time, Jacksonville, Fla.-based Fidelity owned 12% of LendingTree.

Days later, Talbot bought 10,000 shares of LendingTree at $13.50 to $14.50 a share. When USA Interactive, now IAC/InterActiveCorp, announced a deal to buy LendingTree in May 2003, Talbot sold the shares for $20.94 each, netting $67,881.

Talbot’s lawyer, Richard Marmaro, said his client was elated. “He never felt he did anything wrong and this opinion confirms that,” Marmaro said Wednesday.

-- Josh Friedman