The SEC accuses the Dallas billionaire owner of selling his shares in the Internet search engine company Mamma.com Inc. in 2004, avoiding a $750,000 loss after receiving confidential information about the company.
U.S. District Judge Sidney A. Fitzwater dismissed the lawsuit in July 2009, ruling that Cuban never agreed he could not act on his confidential information.
The appeals court, however, says it was "plausible" Cuban knew he was not to sell his shares.
Cuban said by e-mail Tuesday that he was disappointed in the ruling and maintains he did not violate any civil laws.
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