Federal prosecutors and stock regulators are investigating the options US billionaires Barry Diller and David Geffen took on Activision Blizzard stock in January, just days before the video game maker agreed to Microsoft’s acquisition. That reports The Wall Street Journal.
An investigation is also underway into Alexander von Furstenberg, son of fashion designer Diane von Furstenberg.
Diller, Geffen and Von Furstenberg posted unrealized profits of about $60 million on their transactions. In addition, the three took the option to buy Activision shares for $40 each just before the acquisition. After the acquisition, the game developer’s share increased significantly; The exchange rate is currently hovering around $80.
The prosecution is investigating whether the option transactions violated insider trading laws, while the SEC is separately conducting a civil investigation into insider trading.
According to Diller, none of the three men, who know each other privately, had “non-public information about the Microsoft acquisition,” he told The Wall Street Journal. “It was just a lucky guess. We acted on no information from anyone. So it’s one of those coincidences.’
Diller is chairman of media conglomerate IAC and the Expedia Group, among others, and is married to Diane von Furstenberg. Geffen is best known as the founder of film distributor DreamWorks and several record labels, including DGC Records. Diller and Geffen are both prominent Democratic Party donors.