NEW YORK, July 9 (Reuters) - A U.S. regulator on Friday charged three men with insider trading ahead of Long Island Iced Tea Corp's announcement

Iced tea-to-blockchain pivot prompts SEC insider trading lawsuit

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2021-07-09 20:00:02

NEW YORK, July 9 (Reuters) - A U.S. regulator on Friday charged three men with insider trading ahead of Long Island Iced Tea Corp's announcement it would change its name to Long Blockchain Corp, and change its focus to blockchain from iced tea and lemonade, which caused its shares to soar nearly 400%.

The U.S. Securities and Exchange Commission said Eric Watson, who controlled more than 30% of Long Island Iced Tea shares, leaked the news to his friend and broker Oliver-Barret Lindsay, who passed it to his friend Gannon Giguiere, a stock promoter.

According to the SEC, Giguiere bought 35,000 Long Island Iced Tea shares on Dec. 20, 2017, and sold them the next day for a $162,500 profit less than two hours after the Farmingdale, New York-based company's self-described "pivot" became public.

Long Island Iced Tea's share price rose as much as 388% that day, boosting its market capitalization to $92.6 million from $23.8 million.