The SEC charged Andreas “Andy” Bechtolsheim, the founder and former Chairman of Arista Networks, Inc., with misappropriating material nonpublic information regarding the impending acquisition of Acacia Communications, Inc. The case is notable as it is another example of the SEC’s using the “shadow theory” of insider trading, first used in the SEC’s insider trading case against Matthew Panuwat. Bechtolsheim settled the SEC’s charges by agreeing to be barred from serving as an officer or director of a public company for five years and to pay a civil monetary penalty of $923,740. The settlement is subject to court approval.