SEC v. Terren S. Peizer and Acuitas Group Holdings, LLC — U.S. Securities and Exchange Commission Litigation Release No. 26603, dated August 7, 2026.
The SEC filed a civil enforcement action against Terren S. Peizer and Acuitas Group Holdings, LLC for alleged insider trading in Ontrak, Inc. securities. The SEC claimed Peizer sold over $20 million in stock while aware of material non-public information about a major customer termination. The case was subsequently dismissed by joint stipulation, with the SEC exercising its discretion.
In Plain English
Imagine you know a big secret about a company before anyone else does. This secret is bad news that will likely make the company's stock price drop. You then sell all your stock in that company before the bad news becomes public. This is called insider trading. In this case, the SEC accused an executive of doing just that. However, later, the SEC decided to drop the case against him.
Disclaimer: all facts are drawn from the SEC's own filings; the claims described are allegations unless and until a court rules or the parties settle, and some cases end in dismissal.
How the Alleged Scheme Worked
- Executive Chairman's Role Terren S. Peizer was the Executive Chairman and founder of Ontrak, Inc., a behavioral health company. He also served as CEO for periods and owned Acuitas Group Holdings, LLC, his personal investment vehicle.
- Company's Dependence on Key Customers Ontrak's business model relied heavily on contracts with health plan customers. By March 2021, the company disclosed that its operations were dependent on three large customers, and the loss of any one could have a 'material adverse effect'.
- Material Non-Public Information In May through August 2021, Peizer became aware that 'Customer A,' Ontrak's largest customer, was communicating dissatisfaction and was likely to terminate its contract. This information was material, especially after a prior customer termination caused Ontrak's stock to drop over 46%.
- Adoption of Trading Plans During May through August 2021, while aware of Customer A's potential termination, Peizer adopted two stock sales plans through his investment vehicle, Acuitas Group Holdings, LLC, purportedly under Rule 10b5-1.
- Significant Stock Sales Pursuant to these plans, Peizer and Acuitas sold a total of 641,357 shares of Ontrak stock, generating over $20 million. These sales occurred while Peizer possessed the material non-public information about Customer A.
- Public Disclosure and Stock Drop On August 19, 2021, Ontrak publicly disclosed that an unidentified customer (actually Customer A) was terminating its contract. Following this announcement, Ontrak's stock price declined by more than 44%.
- Allegation of Rule 10b5-1 Violation The SEC alleged that Peizer and Acuitas could not rely on the affirmative defense provided by Rule 10b5-1 because Peizer was aware of material non-public information at the time he adopted the trading plans.
- Violations Charged The SEC charged Defendants with violating Section 17(a) of the Securities Act and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder. Peizer was also charged as a control person under Section 20(a) of the Exchange Act.
The Enforcement Action
The Securities and Exchange Commission (SEC) announced on August 7, 2023, that it filed a joint stipulation with Defendants Terren S. Peizer and Acuitas Group Holdings, LLC to dismiss, with prejudice, the Commission’s ongoing civil enforcement action against them. The SEC stated that its decision to seek dismissal was made 'in the exercise of its discretion' and does not necessarily reflect its position on any other case. The original complaint, filed on March 1, 2023, alleged insider trading in Ontrak, Inc. securities.
Named in this action: Terren S. Peizer, Acuitas Group Holdings, LLC.