Former Doximity executive guilty of insider trading ahead of layoffs
A former senior executive at healthcare technology company Doximity has pleaded guilty to securities fraud after trading on confidential information about the company's deteriorating financial performance—transactions that allowed him to avoid losses and generate more than $2.5 million in illegal profits while his own job was at risk.
Paul Jorgensen, who served as the company's chief revenue officer, admitted to two counts of securities fraud in U.S. federal court, according to court documents. The case highlights ongoing challenges in preventing insider trading among corporate executives with access to material non-public information.
Background and Context
Doximity, a publicly-traded digital health platform that connects medical professionals, faced declining sales performance in 2022 and 2023. As a publicly listed company on the New York Stock Exchange, Doximity is required to disclose quarterly earnings results and material business developments to investors in a timely manner, creating windows of opportunity for those with advance knowledge to profit from pending announcements.
The case underscores the persistent problem of executive insider trading in U.S. markets. According to SEC enforcement data, securities fraud cases involving corporate insiders remain a priority for regulators, with hundreds of actions filed annually against executives who misuse confidential information for personal gain.
Key Figures and Entities
Paul Jorgensen served as Doximity's chief revenue officer before being reassigned to a sales position amid the company's declining performance. According to federal court filings, Jorgensen maintained a personal brokerage account containing 61,162 shares of Doximity stock that he failed to disclose to the company, violating corporate compliance policies.
The U.S. Attorney's Office for the Southern District of New York, led by U.S. Attorney Jay Clayton, prosecuted the case. In a statement, Clayton emphasized that Jorgensen "repeatedly used Doximity's confidential information to trade in advance of the company's quarterly earnings calls, earning himself more than US$2.5 million in illegal profits."
Legal and Financial Mechanisms
The insider trading scheme unfolded in two distinct phases, according to prosecutors. In July 2022, Jorgensen learned about negative sales data before its public release. Initially refraining from trading, he later sold his entire personal holding of 61,162 shares after being reassigned, avoiding approximately $300,000 in losses when the stock subsequently dropped 7% following the earnings announcement.
In 2023, Jorgensen engaged in more extensive trading before additional negative news, including corporate layoffs that would ultimately result in his termination. Through strategic purchases and sales of stocks and options, he generated $2.3 million in illicit profits before the information became public. The transactions violated federal securities laws, including Section 10(b) of the Securities Exchange Act and related SEC rules.
International Implications and Policy Response
While this case involves a U.S. company and domestic securities laws, it reflects global challenges in preventing insider trading across international markets. Doximity, like many technology companies, operates internationally, making cross-border regulatory cooperation essential for effective enforcement.
The case illustrates ongoing debates about executive compensation structures and the incentives they may create for insider trading. Regulatory bodies including the Securities and Exchange Commission continue to strengthen surveillance systems and disclosure requirements to detect and prevent such abuses, though sophisticated insiders often find ways to circumvent existing controls.
Sources
This report draws on U.S. Department of Justice press releases, federal court records, SEC enforcement data, and Doximity corporate information. The defendant is scheduled for sentencing on May 21, 2026.
