SEC v. Matthew Groom, No. LR-26159, District of Massachusetts (Oct. 15, 2024) — Press Release

U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 26159 / October 15, 2024 Securities and Exchange Commission v. Matthew Groom, No. 1:24-cv-12621 (D. Mass. filed Oct. 15, 2024) SEC Charges North Carolina Resident with Insider Trading in Massachusetts-Based Biopharmaceutical Company The Securities and Exchange Commission filed insider trading charges today against North Carolina resident Matthew Groom, who allegedly avoided losses of about $13,000 by trading in advance of the May 3, 2022 announcement by the Cambridge, Massachusetts-based biopharmaceutical company Spero Therapeutics, Inc. that it was suspending commercialization efforts for its lead product candidate, Tebipenem Hbr, and downsizing the company. Groom has offered to settle the SEC’s action. Among other things, he has agreed to pay a total of approximately $28,000 in disgorgement of ill-gotten gains, prejudgment interest, and civil penalties. According to the SEC’s complaint, Groom, who worked as an information technology consultant to Spero Therapeutics and was subject to a confidentiality agreement with the company, obtained material nonpublic information about Spero’s planning for a possible workforce reduction. Groom allegedly learned this information during a call with his main point of contact at the company on the morning of March 30, 2022. According to the complaint, 21 minutes after the call was scheduled to end, Groom placed an order to sell all his Spero Therapeutics shares. The SEC alleges that Groom avoided losses of $12,936.86 when Spero Therapeutics’ share price dropped 64% after negative study results about Tebipenem Hbr were made public on May 3, 2022. The SEC’s complaint, filed in U.S. District Court for the District of Massachusetts, charges Groom with violating Section 17(a) of the Securities Act of 1933 (“Securities Act”) and Section 10(b) of the Securities Exchange Act of 1934 (“Exchange Act”) and Rule 10b-5 thereunder. Without admitting or denying the allegations, Groom consented to a judgment permanently enjoining him from future violations of Section 17(a) of the Securities Act and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder; ordering him to pay disgorgement of $12,936.86, prejudgment interest of $2,376.22, and a civil penalty of $12,936.86; and imposing on him a five-year officer-and-director bar. The settlement is subject to court approval. The SEC’s investigation was conducted by Colin Missett, Lawrence Pisto, James Fay, and Susan Cooke, under the supervision of Colin Forbes of the SEC’s Boston Regional Office. The SEC appreciates the assistance of the Financial Industry Regulatory Authority.

U.S. SECURITIES AND EXCHANGE COMMISSION Litigation Release No. 26159 / October 15, 2024 Securities and Exchange Commission v. Matthew Groom, No. 1:24-cv-12621 (D. Mass. filed Oct. 15, 2024) SEC Charges North Carolina Resident with Insider Trading in Massachusetts-Based Biopharmaceutical Company The Securities and Exchange Commission filed insider trading charges today against North Carolina resident Matthew Groom, who allegedly avoided losses of about $13,000 by trading in advance of the May 3, 2022 announcement by the Cambridge, Massachusetts-based biopharmaceutical company Spero Therapeutics, Inc. that it was suspending commercialization efforts for its lead product candidate, Tebipenem Hbr, and downsizing the company. Groom has offered to settle the SEC’s action. Among other things, he has agreed to pay a total of approximately $28,000 in disgorgement of ill-gotten gains, prejudgment interest, and civil penalties. According to the SEC’s complaint, Groom, who worked as an information technology consultant to Spero Therapeutics and was subject to a confidentiality agreement with the company, obtained material nonpublic information about Spero’s planning for a possible workforce reduction. Groom allegedly learned this information during a call with his main point of contact at the company on the morning of March 30, 2022. According to the complaint, 21 minutes after the call was scheduled to end, Groom placed an order to sell all his Spero Therapeutics shares. The SEC alleges that Groom avoided losses of $12,936.86 when Spero Therapeutics’ share price dropped 64% after negative study results about Tebipenem Hbr were made public on May 3, 2022. The SEC’s complaint, filed in U.S. District Court for the District of Massachusetts, charges Groom with violating Section 17(a) of the Securities Act of 1933 (“Securities Act”) and Section 10(b) of the Securities Exchange Act of 1934 (“Exchange Act”) and Rule 10b-5 thereunder. Without admitting or denying the allegations, Groom consented to a judgment permanently enjoining him from future violations of Section 17(a) of the Securities Act and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder; ordering him to pay disgorgement of $12,936.86, prejudgment interest of $2,376.22, and a civil penalty of $12,936.86; and imposing on him a five-year officer-and-director bar. The settlement is subject to court approval. The SEC’s investigation was conducted by Colin Missett, Lawrence Pisto, James Fay, and Susan Cooke, under the supervision of Colin Forbes of the SEC’s Boston Regional Office. The SEC appreciates the assistance of the Financial Industry Regulatory Authority.