Jack P. DiCanio

DiCanio, a former deputy chief of the general crimes section at the United States Attorney’s office in Los Angeles, now heads Skadden’s Palo Alto litigation practice.

He’s been a partner at Skadden for 16 years; among his successes were a 2017 co-defense of FedEx in connection with a criminal indictment and, more recently, securing a deferred prosecution agreement for Chipotle Mexican Grill, Inc., in connection with Department of Justice and Federal Drug Administration investigations relating to norovirus outbreaks.

Recent clients include the directors of Juul Labs Inc., the National Football League, Intel Corporation and Snap Inc., plus a number that remain confidential, often because the matters have not advanced to the public filing stage.

“A good part of our success is illustrated by the number of cases that don’t get brought,” DiCanio said.

He currently represents the target of a novel Securities and Exchange Commission suit that seeks to expand the definition of insider trading to include so-called “shadow trading,” in which company officials possessing non-public information use it to trade stock in competitors’ or supply chain partners’ companies. The case is among the first to test the legality of the maneuver.

“What makes this interesting is that this is the first time the SEC has tried to extend the definition of insider trading to that conduct,” DiCanio said. He has already moved to dismiss the complaint, which was filed in August. Securities and Exchange Commission v. Panuwat, 4:21-cv-06322 (N.D. Cal., filed Aug. 17, 2021).

The defendant, Matthew Panuwat, is the former head of business development at Medivation, Inc., a San Francisco-based biopharmaceutical acquired by Pfizer Inc. in 2016. The SEC’s complaint alleges that Panuwat bought stock options in the rival drug company Incyte Corp. upon learning of the Pfizer deal.

DiCanio’s dismissal motion contends that the SEC falls short of alleging essential elements of insider trading and instead asserts “that because Medivation and Incyte were both biopharmaceutical companies with certain broad similarities (without consideration of substantial differences), what is material to Medivation is therefore material to all other companies that could be perceived as potentially similar to it based on subjective criteria established by the SEC.”

In an interview, DiCanio stated his defenses are both factual—that his client did not engage in trading his own company’s stock based on inside information—and legal. “The SEC hasn’t given the marketplace notice it would seek to apply insider trading laws in such a broad and vague manner. We feel good about our defenses.”

DiCanio is preparing for trial next year in another matter in which he represents Fujian Jinhua, a China-based manufacturer of DRAM memory devices, that was one of the first companies to be accused of economic espionage as part of then-President Donald J. Trump’s China Initiative. U.S. v. United Microelectronics Corp. et al., 3:18-cr-00465 (N.D. Cal., filed Sept. 27, 2018).

He declined to say much about the case except, “I think it’ll be an interesting trial.”

- John Roemer