UNITED STATES SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 15765 / June 3, 1998 SECURITIES AND EXCHANGE COMMISSION V. BHARAT KOTECHA and ARNON ISAACSON, Civil Action No. 1: 98-CV-1576 (N.D.Ga.) The Securities and Exchange Commission announced that a complaint for injunctive and other relief was filed by the Commission on June 3, 1998, in the United States District Court for the Northern District of Georgia against defendants Bharat Kotecha ( Kotecha ) and Arnon Isaacson ( Isaacson ), former employees of The Home Depot, Inc. ( Home Depot ), an Atlanta-based chain of home improvement and building supply stores. The complaint seeks to permanently enjoin Kotecha from further violations of Section 17(a) of the Securities Act of 1933 and to permanently enjoin both Kotecha and Isaacson from further violations of Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. The Commission also seeks disgorgement of all gains enjoyed and all losses improperly avoided by Kotecha and Isaacson and by those persons to whom the defendants conveyed material nonpublic information acquired from Home Depot, prejudgment interest thereon, and civil penalties pursuant to the Insider Trading Sanctions Act of 1984. The Commission's complaint alleges that, during April and May of 1995, while employed in Home Depot's accounting department, Kotecha and Isaacson learned that the company's financial performance during the first quarter of its 1995 fiscal year would be disappointing. Using the information they received in the course of their work, the defendants opened and closed positions in call and put options on Home Depot's stock shortly before the company's public announcement about its disappointing first quarter earnings on May 16, 1995. In addition, Isaacson tipped his father and brother, who also used the information to open and close positions in put options on Home Depot's stock during the same time period. Through his trading on confidential information, Kotecha realized gains and avoided losses in the amount of $47,312.50. Isaacson, his father and his brother realized gains of $23,650 from trading prior to Home Depot's public announcement. ======END OF PAGE 1======