* Billionaire accused of insider trading in Mamma.com
* Lawyer says Cuban did nothing wrong, sold stake for several reasons (Recasts with Cuban testifying he was not told information was confidential)
By Jana J. Pruet
DALLAS, Oct 3 (Reuters) - Mark Cuban, the billionaire owner of the Dallas Mavericks basketball team, told jurors at his insider trading trial on Thursday that he was angry when he learned that an Internet company he had invested in was planning an equity offering, but said he was not told the offering was confidential.
Cuban was called to testify by the U.S. Securities and Exchange Commission, which accused him of dumping his $7.9 million worth of shares in Montreal-based Internet search company Mamma.com Inc after learning that it planned a private placement that would dilute his stake.
Cuban, 55, acknowledged he did not support the planned offering, but maintained that he did nothing wrong when he sold his stake in June 2004.
Cuban is accused of trading on inside information when he unloaded his 600,000 shares after learning in a June 28, 2004 phone call from Mamma.com Chief Executive Guy Fauré about the offering, which would have dropped Cuban's stake to 4.9 percent from 6.3 percent.
Mamma.com shares dropped 9.3 percent on June 30, 2004, the morning after the offering was announced. By that time, Cuban had already sold his shares, avoiding a $750,000 loss.
In his testimony, Cuban said that immediately after the June 28 phone call with Fauré, he called Arnie Owens, the man in charge of the equity offering.
"He invited me to be an investor," Cuban said of Owens.
Instead of buying in, Cuban called his broker and told him to sell the shares at market price. Some 10,000 sold that day, and the other 590,000 sold the following day, Cuban testified.
SEC lawyer Jan Folena attempted to show through questioning about email exchanges and blog entries that Cuban dumped the shares solely to avoid a financial loss on a deal that no one else was privy to at the time.
Cuban testified that he did not support equity offerings such as the one that was in the works at Mamma.com.
He also said he had recently learned Mamma.com was being investigated by the SEC about possible dealings by a known stock swindler, the late Irving Kott, and that it was one of several reasons he sold his shares.
Earlier this week, the SEC presented video testimony from Fauré, who said Cuban told him upon learning of the offering plan: "Now I'm screwed. I can't sell."
Cuban disputed that account, and maintains that he never believed the information was confidential or material enough to trigger an insider trading violation.
Fauré cannot be subpoenaed to testify in person because he is a Canadian citizen.
In suing Cuban, estimated by Forbes magazine to have a net worth of $2.5 billion, the SEC is seeking to recoup ill-gotten gains, impose fines and obtain a permanent injunction to bar him from similar alleged misconduct.
The government shutdown that began on Tuesday is not expected to affect the trial before U.S. District Judge Sidney Fitzwater in Dallas. The trial is expected to last eight to 10 days.
Cuban rose to prominence ahead of the dot-com crash by selling his company, Broadcast.com, in 1999 to Yahoo Inc for $5.7 billion.
He is a star of the ABC television show "Shark Tank" and has appeared on ABC's "Dancing with the Stars" and on HBO's "Real Time with Bill Maher."
The SEC brought the civil lawsuit against Cuban in November 2008. Fitzwater dismissed the suit in 2009, but a federal appeals court revived the case the following year.
The case is SEC v. Cuban, U.S. District Court, Northern District of Texas, No. 08-02050. (Editing by Karen Brooks, Lisa Shumaker, John Wallace and Dan Grebler)