This case involves the CEO of a company that had a projected total revenue for the year of $nearly $20 billion. The CEO set the company’s internal targets $500 million higher than the public prediction to encourage company employees to surpass public targets. Several employees expressed concern that the public and internal targets were too high and believed the company could only make $18.4 billion. The CEO received a “risk estimate” forecasting a potential shortfall in the yearly earnings. The estimate stated that earnings could end up nearly $900 million below the public projections. The CEO received a substantial portion of his salary in stock options. The CEO exercised his stock options at the same time that he received information that the company’s earnings were in danger of falling nearly one billion dollars short of projected revenue estimates. The CEO sold more than a million shares of his stock in the company during trading windows each quarter directly after the company announced its quarterly earnings. The CEO was indicted for insider trading and tried to defend himself by showing that he had committed in advance to a Rule 10b501 stock sale plan.