Opinion ID: 350232
Heading Depth: 2
Heading Rank: 3

Heading: Sales Information

Text: 41 The SEC also deems material Schuman's statement that Soflens sales had flattened out at less than one lens per practitioner per week, and his admission that sales had been hurt by flak. The trial court was free to discount completely the rate of sales remark, however, since Schuman adamantly denied making it, and we agree with Judge Ward that the others cannot be characterized as inside information. 42 It was common knowledge among members of the investment community that the momentum of Soflens sales had slowed. The facts leading to this conclusion were public, not internal corporate information. The press had highlighted negative reports concerning the safety and quality of soft contact lenses. It was also well known that sales in the first quarter of 1972 would depend upon sales of replacement lenses or new orders of the 72-lens kits by practitioners who had not responded to B & L's initial promotional campaign. Not surprisingly, each of the analysts with whom Schuman met on March 15th and 16th, like other members of the investment community, had concluded before their interviews that Soflens sales had flattened. Indeed, the Brokaw analysts fully intended to drive that very point home to Schuman. And since the impact of the negative publicity was the stated premise upon which the interviews were conducted, it would have been incredible and misleading for Schuman to deny the flak had any effect. 8 43 It is therefore patent that Schuman did not convey any significant new facts to analysts concerning sales during the interviews. Rather, as the trial court correctly concluded, the analysts merely tested the meaning of public information, an exercise which the Commission itself has urged as useful and appropriate.