Defendant Name: ArthroCare Corporation

Defendant Type: Public Company
SIC Code: 3845
CUSIP: 04313610

Initial Case Details

Legal Case Name In the Matter of ArthroCare Corporation
First Document Date 09-Feb-2011
Initial Filing Format Administrative Action
File Number 3-14249
Allegation Type Issuer Reporting and Disclosure
AAER 3242

Violations Alleged

Exchange Act
• Rule 12b-20
• Sec 13(a)
• Rule 13a-1
• Rule 13a-13
• Sec 13(b)(2)(A)
• Sec 13(b)(2)(B)

Resolutions

First Resolution Date 09-Feb-2011

Related Documents:

34-63883 09-Feb-2011 Administrative Proceeding
Order Instituting Cease-and-Desist Proceedings Pursuant to Section 21C of the Securities Exchange Act of 1934, Making Findings, and Imposing a Cease-and-Desist Order
On February 9, 2011, the SEC filed settled administrative proceeding against ArthroCare Corporation. According to the SEC: "Between the fourth quarter of 2005 and the first quarter of 2008 (the 'restatement period'), ArthroCare materially overstated and prematurely recognized revenue, primarily on sales of SpineWands to certain of ArthroCare's agents and distributors, including DiscoCare. Most of these transactions occurred at or near quarter-end and were intended to help the company reach aggressive internal revenue targets and satisfy analysts' revenue expectations. ArthroCare lacked an effective system of internal controls over sales, particularly with respect to its Spine Business Unit, where most of the improprieties occurred. This allowed ArthroCare sales personnel to withhold critical information on revenue recognition from the company's accounting staff."

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