SEC Fraud Enforcement in Silicon Valley: The App Annie Case

Event: SEC Fraud Enforcement in Silicon Valley: The App Annie Case

Host: UC Hastings Center for Business Law

Date: Thursday, April 14th, 2022

Time: 12:00–1:oo p.m. (PT)

Location: Cotchett Law Center at UC Hastings College of the Law, Deb Colloquium Room 501 (333 Golden Gate Avenue, San Francisco CA)

On Sept 21, 2021, App Annie Inc. (now Data.ai), a leading alternative data provider for the mobile app industry, and its co-founder and former CEO and Chairman Bertrand Schmitt, agreed to settle securities fraud charges with the SEC for engaging in deceptive practices and making material misrepresentations about how App Annie’s alternative data was derived (e.g., that the data it sold to more than 100 hedge funds was derived in a way that was consistent with the consents obtained from companies that shared their confidential data). The SEC’s order found that App Annie and Schmitt violated the anti-fraud provisions of Section 10(b) of the Exchange Act and Rule 10b-5 thereunder. Without admitting or denying the findings, App Annie and Schmitt consented to the entry of a cease-and-desist order under which App Annie was ordered to pay a penalty of $10 million, Schmitt was ordered to pay a penalty of $300,000, and Schmitt was prohibited from serving as an officer or director of a public company for three years. This first-of-its-kind enforcement action shows that the SEC is actively looking into practices in the alternative data industry.

Please note that spaces are limited (priority will be given to UC Hastings students and alumni).