The post was updated at 4:30 p.m., with S.E.C. statement and closing stock price. It was updated at 7 p.m. to correct the percent of the Mamma.com stock Mr. Cuban owned.

Did Mark Cuban, the Internet entrepreneur turned owner of the Dallas Mavericks basketball team, and would-be buyer of the Chicago Cubs, violate insider trading laws in a particularly egregious fashion?

Or is he the victim of a political hit job because he helped finance a movie that was scathingly critical of President Bush?

Either way, the insider trading complaint from the Securities and Exchange Commission today arouses a lot more interest than most enforcement actions.

I’ll get to the facts of the complaint in a minute, but first here is Mr. Cuban’s reaction. His lawyers issued a statement saying:

This matter, which has been pending before the commission for nearly two years, has no merit and is a product of gross abuse of prosecutorial discretion. Mr. Cuban intends to contest the allegations and to demonstrate that the commission’s claims are infected by the misconduct of the staff of its enforcement division. Mr. Cuban stated, “I am disappointed that the commission chose to bring this case based upon its enforcement staff’s win-at-any-cost ambitions. The staff’s process was result-oriented, facts be damned. The government’s claims are false and they will be proven to be so.”

A person close to Mr. Cuban provided me with a copy of an e-mail message said to have been sent by Jeffrey Norris, an S.E.C. lawyer in the Fort Worth regional office (and no known relation to me.) This e-mail message seems to have been sent after an exchange in which Mr. Norris complained that Mr. Cuban had financed a movie called “Loose Change” that discusses the president’s actions relating to Sept. 11.

From: Norris, Jeffrey B. [mailto:NorrisJ@SEC.GOV]

Sent: Saturday, May 05, 2007 2:27 PM

To: Mark Cuban

Cc: Cox, Christopher

Subject: RE: “Lose Change” I AM SHARING THIS WITH CHAIRMAN COX. NEITHER HE NOR THE COMMISSION ENDORSE MY OPINIONS, BUT IN LIGHT OF YOUR THREAT, I THOUGHT SHOULD SEND THIS TO HIM. Mark:

If this upsets you, I wonder how George Bush feels. I assume that Mr. Cox would view your involvement with “Loose Change” much as I do. After all, he served his country as a Republican Congressman from Orange County for nearly 20 years and was appointed by President Bush. If you feel like sharing my thoughts with Chairman Cox, be my guest. Previously, I thought you were merely foolish and naïve. Now, however, I see that you are also a hypocrite. I guess your belief in free speech has severe limitations. If someone else is the victim of an absurd conspiracy theory, you defend your right to participate in smearing the good name of a patriot like President Bush. But, when you are the subject of a parody of the attack you have endorsed, you suddenly issue threats. I think I will e-mail this to Chairman Cox myself. I think he will enjoy it. I’m sure he is also a Laker fan. Since Chairman Cox may not know the background, I will explain. Mark Cuban is the owner of the Dallas Mavericks and has participated in distributing the vicious and absurd documentary, “Loose Change,” which posits that President Bush planned the demolition of the World Trade Center as a pretext for going to war against Iraq. We have had some past exchanges about my opinion the Mr. Cuban’s support for this project is irresponsible and immoral. Below, I parodied his position that every opinion, no matter how absurd and vicious, deserves to be broadly disseminated.

The copy sent to me does not include the previous parody.

John Nester, an S.E.C. spokesman, said this afternoon that the investigation was conducted by the S.E.C.’s Washington office, and that Mr. Norris was not involved in it. He added:

“Chairman Cox has never met the individual who corresponded with Mr. Cuban, nor has he spoken or corresponded with him in any way. After those communications came to light, the matter was referred for disciplinary action against the individual. To avoid any potential appearance issues, Chairman Cox recused himself from the Commission vote, and he has not been involved in this investigation at any time.”

The vote he refers to was the commission’s vote to file the case.

Mr. Norris has not returned a call left for him at his office.

Now for the facts of the insider trading case.

Mr. Cuban made a substantial profit from a quick trade in an Internet company that, oh-so-briefly, was a hot stock in 2004. It is not clear from public records just how much money he made, but even if the S.E.C. succeeds in its efforts to take about $750,000 in profits from him, he will still be one of the few public shareholders to rank as having made a lot of money from the company.

Mamma.com was, and is, an Internet search engine. In late February 2004, it was trading for around $4 a share. Then it announced earnings and announced new advertising features and the stock took off, aided by some stock tip sheets. (That trading brought on an S.E.C. investigation, which ended without charges being filed.)

The trading was crazy. A company with 10.5 million shares outstanding was trading more than 60 million shares a day while the stock ran up. There was heavy short-selling.

Mr. Cuban disclosed that he had acquired 600,000 shares, a 6.3 percent stake, by March 15, 2004. He did not disclose a purchase price or say when he had acquired the shares.

According to the S.E.C., on June 28, 2004, the company’s chief executive asked Mr. Cuban if he would like to participate in a planned new offering of the company’s stock. After being warned that he was receiving confidential information, Mr. Cuban is said to have expressed dismay about the offering. “At the end of the call, Cuban told the C.E.O. ‘Well, now I’m screwed. I can’t sell.’ ”

But a few minutes later he did sell 10,000 shares in after-hours trading. He sold the rest the next day. He took in $7.9 million, realizing an average of $13.24 per share. After the close on June 29, the offering was announced, and the stock opened the next day at $11.89. The S.E.C. figures that is a measure of his illicit gain.

Mamma.com is still around. In fact, I did all the searches connected to this blog using that search engine, and it performed quite adequately. But it has not prospered. The corporate name has changed to Copernic and the current stock price is 28 cents. At that price, Mr. Cuban’s former holding would be worth $168,000.

Mr. Cuban disclosed that sale, as required for a major holder. It is not clear what caused the S.E.C. to begin its investigation in early 2007, two and a half years after the sale. But if Mr. Cuban had waited to sell, he still would have gotten a very good price for the stock — at least from the perspective of 2008 — and the S.E.C. would have had no case.

As it is, there appears to be no question about when Mr. Cuban sold the stock. The S.E.C. cites phone company records and company memos about the timing and content of the call. If those memos were accurate, it appears that Mr. Cuban knew he had a duty not to sell until the information about the offering was made public.

But even if all that is true, the Norris e-mail, sent from an S.E.C. e-mail address, indicates the commission has a lawyer with, at best, very poor judgment.