Updated from 12:55 p.m. EDT

It took an unusual twist, but federal authorities finally caught up with Scott Sacane, the former hedge fund manager who "inadvertently" became the biggest stockholder in two small health care companies.

In a settlement with federal prosecutors, Sacane agreed to pay a $350,000 civil penalty over charges his

Durus Capital

hedge fund secretly became a big acquirer in shares of

Aksys

(AKSY)

and

Esperion

.

But in going after Sacane, prosecutors didn't charge the Connecticut resident with some version of securities fraud. Instead, authorities took the novel approach of charging him with violating federal antitrust laws.

Prosecutors contend Sacane, by acquiring majority stakes in both companies, failed to "comply with antitrust premerger notification and waiting period requirements." Specifically, Sacane failed to first notify the Federal Trade Commission of his intent to acquire more than $50 million of each company's voting stock.

Authorities contend Sacane was in violation of the antitrust notice provision from Feb. 24, 2003, through May 2, 2005, the time frame during which Durus went on its buying spree. Prosecutors brought the action on behalf of the FTC.

"This significant penalty should put hedge funds, their managers, and securities traders on notice that they are not exempt from filing premerger notification forms when required to do so," said Susan Creighton, director of the FTC's bureau of competition. "The defendant in this case is an experienced fund manager who should have known and fulfilled his obligations."

Sacane's attorney, Matthew Dontzin, could not be reached for comment. In settling, Sacane neither admitted nor denied the allegations.

Sacane's big holdings in Aksys and Esperion became headline news in July 2003, when he belatedly disclosed that his one-time $500 million fund had obtained a 77% ownership stake in Aksys and a 33% stake in Esperion.

In regulatory filings, Sacane has said his fund "inadvertently" acquired all those shares, but he's never offered an explanation for how that occurred. At the time, some in the hedge fund world quipped that maybe he had fallen asleep with his finger on the "buy" key.

But many saw a more sinister strategy at work, attributing it to either outright stock manipulation or gross incompetence.

Indeed, in the summer of 2003, the

Securities and Exchange Commission's

Boston office opened an investigation in the matter. But to date, nothing has ever come from that inquiry.

It was not known that prosecutors also were looking into Sacane's trading. But the Justice Department's decision to pursue an antitrust action against Sacane may be an indication that authorities have had a hard time proving the hedge fund manager's actions were intentional.

In a stroke of luck, Sacane's big purchases in Espersion ultimately worked out for him.

In December 2003, pharmaceutical giant

Pfizer

(PFE) - Get Report

announced a deal to buy Esperion for $1.3 billion, which represented a 54% premium to then $22.70 a share price. At the time, Durus still owned 30% of the company's stock and the deal represented a windfall for the embattled hedge fund.

The deal valued the hedge fund's stake at $350 million, tens of millions of dollars more than Sacane had spent acquiring those shares.

The Durus fund also was forced to forfeit nearly $40 million in short-term profits it made from trading in shares of Esperion and Aksys. The hedge fund had to return those profits after both companies sued Durus under a little-known securities regulation that applies to large shareholders. The law prohibits holders of 10% or more of a company's stock from making short-swing trades.