On January 15, the Attorney General of New York filed a Martin Act complaint in state Supreme Court against Robert G. Kramer, the former chief executive of Emergent BioSolutions, alleging he sold 88,555 shares of company stock for proceeds of more than $10.1 million between January and February 2021, while in possession of material non-public information that the company’s Baltimore manufacturing plant had ruined batches of the AstraZeneca COVID-19 vaccine. Six days earlier, on January 9, the same office had settled with Emergent itself for $900,000, under an Assurance of Discontinuance that faulted the company for approving Mr. Kramer’s Rule 10b5-1 trading plan in November 2020 after he had already, the state alleges, been briefed on the contamination. The two filings, read together, describe a transaction whose constituent dates are not in dispute, and a theory of liability rarely brought by a state attorney general against a public-company executive: that a 10b5-1 plan adopted on inside information does not protect the trades that follow.
The case is The People of the State of New York v. Robert G. Kramer, filed in the Supreme Court of the State of New York, New York County. The Office of the Attorney General is proceeding under the Martin Act, the 1921 statute that gives the office broad civil and criminal authority over securities transactions touching New York and that, unlike the federal securities laws, does not require the state to prove scienter. The complaint seeks damages, disgorgement of all proceeds from the trades, and costs. The Assurance of Discontinuance, signed by Emergent on January 9, requires the company to pay $900,000 in penalties to the State of New York and to amend its insider-trading policy. Neither filing is a criminal proceeding; federal prosecutors and the Securities and Exchange Commission did not bring an insider-trading case against Mr. Kramer.
What the company knew, and when
The chronology in the Attorney General’s complaint is built from internal Emergent records produced in the office’s investigation and from the public regulatory and congressional record. The complaint alleges that on October 6, 2020, Mr. Kramer received a PowerPoint briefing on contaminated vaccine batches produced at Emergent’s Bayview facility in Baltimore. A week later, on October 13, 2020, multiple batches were declared lost. The following day, October 14, Mr. Kramer instructed his financial adviser to begin establishing a Rule 10b5-1 plan to sell company stock. The plan was approved by Emergent’s general counsel on November 13, 2020, after a 60-day cooling-off period under the rule. Trading commenced in January 2021, after the cooling-off period had run; the last sale closed on February 8, 2021. AstraZeneca’s contamination problems became public knowledge on March 31, 2021, when The New York Times first reported them. Shares of Emergent fell sharply over the following months.
Some of those facts have been on the public record for years. In May 2022, the House Select Subcommittee on the Coronavirus Crisis and the House Committee on Oversight and Reform released a joint staff report titled “Uncovering Extensive Vaccine Manufacturing Failures at Emergent BioSolutions,” concluding that nearly 400 million doses of coronavirus vaccine had been destroyed because of quality failures at the Bayview plant, that AstraZeneca had concluded after site visits in November and December 2020 that “poor cleaning was part of the root cause” of the persistent contamination, and that Emergent had taken steps to limit access to the facility, tamper with drug-substance labels, and withhold information from the Department of Health and Human Services. The Biden administration terminated Emergent’s contract in November 2021. The Bayview plant has since been closed.
On April 7, 2025, the Securities and Exchange Commission entered a settled administrative order against Emergent under Release No. 33-11371, finding that from at least April 2020 through April 2021 the company had made “materially misleading public statements” about its readiness to manufacture COVID-19 vaccine doses at scale, omitting information about facility, personnel, and quality-control issues that, the order found, the company was aware of internally. Emergent neither admitted nor denied the SEC’s findings and consented to a cease-and-desist order and a civil penalty. A separate securities class action brought by Emergent shareholders, In re Emergent BioSolutions Inc. Securities Litigation, settled in 2024 for $40 million, paid substantially from insurance proceeds.
Why a 10b5-1 plan, here, is the question
Rule 10b5-1, adopted by the SEC in 2000, is the safe harbor that lets corporate insiders sell company stock without violating federal insider-trading prohibitions, provided the trades are made under a written plan adopted in good faith at a time when the insider does not possess material non-public information. The defense is affirmative: the insider, or here the chief executive, must establish that the plan was entered into clean. The Attorney General’s theory in the Kramer case attacks the entry. Not the trades themselves, which occurred mechanically after the cooling-off period, but the moment of adoption on October 14, 2020, when the state alleges Mr. Kramer already held the October 6 briefing in his hands.
That is a federal-law theory the SEC could have brought. It did not. The reasons, on the public docket, are not stated, but practitioner commentary published in the weeks after the Attorney General’s filing, including client alerts from Davis Polk, Gibson Dunn, Herbert Smith Freehills Kramer, and Akin Gump, observed that federal insider-trading enforcement requires the government to prove scienter, the defendant’s knowing or reckless awareness, and that the involvement of Emergent’s in-house counsel in approving the plan complicated that proof. The Martin Act does not contain a scienter requirement. New York can prevail by showing that Mr. Kramer adopted the plan while in possession of material non-public information; intent need not be separately established.
The Rule 10b5-1 plan was not a shield. The company approved a plan that was unlawful when entered into, and the trades that followed were unlawful because the plan was. — Office of the New York Attorney General, summary of the People v. Kramer complaint, January 15, 2026
What the settlement requires
The Assurance of Discontinuance signed by Emergent on January 9 contains both findings of fact and a forward-looking compliance order. Under the agreement, the company pays $900,000 to the State of New York and adopts a revised insider-trading policy that requires any senior officer adopting a 10b5-1 plan to certify, in writing, that the officer does not at the time of adoption possess material non-public information. The revised policy includes a defined list of categories that count as material; the list expressly enumerates “significant development[s] in the Company’s relationships with key regulators,” knowledge of “whistleblower or ethics complaints and the results of any investigations into such complaints,” and “material and notable production issues.” The third category is the one most directly responsive to the conduct alleged in the Kramer complaint. The company does not admit or deny the underlying findings.
The Attorney General’s jurisdiction to bring the case rests on three connections to New York stated in the complaint: that the trades were executed through a New York-based block-trading desk on the New York Stock Exchange; that the Rule 10b5-1 plan was governed by New York law; and that New York residents held Emergent shares affected by the trading. Practitioner commentary noted that the third basis, if accepted by the court, would extend the reach of the Martin Act to a wide range of corporate-executive trading regardless of where the company is headquartered. Emergent is incorporated in Delaware; its principal place of business is in Gaithersburg, Maryland.
What is unresolved
Several questions remain open. The court has not ruled on whether the Martin Act applies to a 10b5-1 plan adopted by a non-resident executive whose company is not headquartered in New York, and Mr. Kramer’s response to the complaint, when filed, may contest that question. The complaint does not name the financial adviser who set up the plan; whether the adviser was on notice of the October 6 briefing is one of the questions the parties may litigate. The depositions, exhibits, and document discovery in the matter are not yet public. The SEC’s 2025 administrative order against Emergent did not name Mr. Kramer individually, and the SEC has not filed any subsequent action against him; whether the federal authorities will join the New York proceeding, or independently revisit the question, is not knowable from the public docket.
The Moxley Press contacted Emergent BioSolutions through its investor-relations office on April 29 for comment on the Assurance of Discontinuance and the revised insider-trading policy. An Emergent spokesperson responded on May 2, pointed to the company’s public statements at the time of the settlement, and declined to comment further. Counsel for Mr. Kramer, identified on the docket, was contacted by email on April 29; no response had been received by publication. The Office of the New York Attorney General’s press office was contacted on April 30; a spokesperson responded on May 1 and pointed to the office’s January 15 press release and the filed complaint, declining to comment further on a matter in active litigation. We will update this story with any response received after publication.
The Kramer matter is, for the moment, a New York case. But the document trail that grounds it is wider than New York. It runs through the FDA’s April 2021 Form 483 observations at Bayview, through the May 2022 House staff report on the destroyed doses, through the April 2025 SEC administrative order finding the company’s public statements materially misleading, and into the Attorney General’s January 2026 complaint. The dates of Mr. Kramer’s trades are the same in all of them. What is being argued, four years after the trades closed, is whether the safe harbor that lets executives sell shares without legal exposure can survive the contemporaneous knowledge of what was happening, at the time of the trades, on the factory floor in Baltimore.