Berkshire Hathaway (BRK.a) Said David Sokol Violated Company Policy

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The audit committee of Warren Buffett's Berkshire Hathaway (NYSE: BKR/a) (NYSE: BRK/b) concluded that David Sokol's trading in shares of Lubrizol (NYSE: LZ) ahead of the takeover violated company policies, including its Code of Business Conduct and Ethics and its Insider Trading Policies and Procedures.

The committee said Sokol's "misleadingly incomplete disclosures" violated his duty to the company.

Berkshire said Sokol didn't disclose:

the amounts and timing of his purchases;
the fact that he bought the shares after discussing Lubrizol with Citi and after Mr. Sokol had narrowed the bankers' initial list of 18 chemicals companies to one, namely Lubrizol;
the fact that Mr. Sokol had bought shares after Mr. Sokol (acting as a senior representative of Berkshire Hathaway scouting acquisition candidates) had asked for Citi’s help arranging a meeting with Lubrizol's CEO to discuss Lubrizol and Berkshire; and
the fact that Mr. Sokol bought shares after learning that Citi had discussed his request for a meeting with Lubrizol’s CEO, who told Citi that he would discuss Berkshire Hathaway’s possible interest in a transaction with the Lubrizol board.

A link to the Berkshire Hathaway release of the details of the matter can be found at the company's website.

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