ISIDER TRADING ON KNOWLEDGE OF INTENDED TENDOR OFFER

FROM: SECURITIES AND EXCHANGE COMMISSION

SEC Charges Georgia Resident with Insider Trading

On August 28, 2012, the Securities and Exchange Commission filed a civil injunctive action in the Northern District of Georgia against Casey D. Jackson ("Jackson"). The Commission alleges that Thomas D. Melvin ("Melvin"), a Griffin, Georgia based CPA and friend of C. Roan Berry ("Berry"), disclosed material non-public information about the pending tender offer for Chattem, Inc. ("Chattem") securities to Berry. The Commission also alleges that Berry tipped his next door neighbor, Ashley J. Coots. The Commission further alleges that Coots tipped Casey D. Jackson ("Jackson"), and that Jackson traded in the securities of Chattem based on that material non-public information.

According to the Commission’s complaint, on December 21, 2009, Sanofi-Aventis ("Sanofi"), a French pharmaceutical company, announced its intent to make a tender offer for Chattem, a Tennessee-based distributor of over-the-counter pharmaceutical products, at the price of $93.50 per share ("Announcement"). Shares of Chattem closed 32.60% higher on the day of the Announcement than the prior trading day’s close of $69.98 and volume increased more than 3,000% to 10.3 million shares.

The Commission alleges that in early December 2009, several weeks before the Announcement, an independent board member of Chattem who owned Chattem options that would automatically exercise in the event of an ownership change at Chattem, initiated a series of confidential conversations and meetings with his longtime accountant, Melvin, to discuss potential methods of ameliorating the effect of an acquisition of Chattem on his tax liability. The Chattem board member told Melvin sufficient facts such that, given Melvin’s knowledge of the board member’s affairs, Melvin would have clearly known that the board member was discussing Chattem. Melvin and the Chattem board member also discussed the price impact of the tender offer on the board member’s options.

The Commission further alleges that Melvin misappropriated material non-public information regarding the impending tender offer for Chattem securities. Within days of his first meeting with the board member, Melvin disclosed material non-public information about the impending tender offer to Berry. Berry tipped Coots, who tipped Jackson. Jackson traded in Chattem securities based on the material non-public information Coots disclosed to him.

Jackson has agreed to settle the Commission claims against him by consenting to the entry of a final judgment providing permanent injunctive relief under Section 10(b) of the Exchange Act of 1934 and Rule 10b-5 and by paying disgorgement of $2,369.78, prejudgment interest of $221.93, and a penalty of $1,184.89. Jackson neither admits nor denies the Commission’s allegations, and his settlement is subject to court approval.