Securities and Exchange Commission Investigates Doyle Brunsons’s Offer to Buy World Poker Tour

by Lou on December 17, 2005

Was Brunson’s Offer to Buy World Poker Tour Just a “Pump and Dump” Scheme?
The Securities and Exchange Commission is investigating whether a $700 million bid from an investment group headed by Doyle Brunson violated anti-fraud laws. The group’s offer represented a 100 per cent premium over World Poker Tour Enterprises market value.

Shares Rose; Then They Fell
Shares in WPTE, parent of the World Poker Tour television series, rose more than 50 per cent when the offer was disclosed in July, only to fall when the bid expired a few days later. WPTE could not substantiate the offer, saying Doyle Brunson and Goodman & Chesnoff, the Las Vegas law firm representing him, had ended communication. According to the Securities and Exchange Commission, “Publication of this offer, widely covered in the media, triggered a steep rise in WPT’s stock price on record trading volume.”

Can the SEC Enforce Their Subpoenas and Set Aside Attorney-Client Privilege on Legas Grounds?
The SEC is trying to enforce subpoenas issued to Goodman & Chesnoff attorneys David Chesnoff and Chaka Henry to hand over documents and testimony, according to documents filed this week in federal court in Texas. The SEC is seeking to set aside attorney-client privilege on legal grounds. A WPTE spokesperson said the company would co-operate fully with the investigation.

Brunson Invokes Fifth; Asks Attorneys to Withhold Documents
Doyle Brunson has invoked his Fifth Amendment right against self-incrimination and declined to testify in the investigation. He invoked the attorney-client privilege and asked the Goodman & Chesnoff attorneys to withhold documents related to the offer.

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