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U.S. SECURITIES AND EXCHANGE COMMISSION


Litigation Release No. 14689 / October 12, 1995

SECURITIES AND EXCHANGE COMMISSION v. RICHARD J. SMITH, Civil
Action No. 95-6440 MRP (C.D. Cal.)   

     The Securities and Exchange Commission ("Commission") filed
a complaint on September 27, 1995, in the United States District
Court for the Central District of California against Richard J.
Smith ("Richard Smith") alleging insider trading in connection
with his and his tippees' sales and/or short sales of PDA
Engineering ("PDA") stock in June and July 1993 prior to a public
announcement by PDA, on August 19, 1993, that its 1993 fourth
quarter earnings had dropped to $.10 per share from 1992's fourth
quarter earnings of $.17 per share, or a 41% decline.  

     The Commission alleges in its complaint that between mid-
April 1993 and July 20, 1993, Richard Smith, while acting as
PDA's vice-president and North American Sales Manager for its
Software Division, became aware of material, nonpublic
information concerning PDA's 1993 fourth quarter financial
results and, in June 1993, traded 51,445 PDA shares while in
possession of this information.  The complaint further alleges
that Smith conveyed this material, nonpublic information to
Angela Bravo de Rueda, a PDA employee with whom Richard Smith
maintained a close, personal relationship, and David Smith, his
father, who each sold all of their PDA shares, and in the case of
David Smith, sold PDA shares short.  

     In addition, the complaint alleges that in July 1993,
Richard Smith sold short a total of 35,000 PDA shares while in
possession of the material, nonpublic information concerning
PDA's 1993 fourth quarter financial results.  As a result of
Richard Smith's trading, the complaint alleges combined profits
and losses avoided of $121,667.95.  Further, the complaint
alleges that Richard Smith's tippees, Angela Bravo de Rueda and
David Smith, avoided losses and/or gained profits of $136.66 and
$16,497, respectively.  

     The Commission's complaint against Richard Smith seeks a
permanent injunction from future violations of Section 17(a) of
the Securities Act of 1933 and Section 10(b) of the Securities
Exchange Act of 1934 and Rule 10b-5 thereunder, and disgorgement
of his and his tippees' trading profits gained and/or losses
avoided with prejudgment interest thereon.