COYOTE CONFERS WITH SEC.

Byline: Ben Sullivan Daily News Staff Writer

Coyote Network Systems shares rose as much as 36 percent Monday as the telecommunications equipment maker said it asked the Securities and Exchange Commission to investigate recent heavy trading of its stock.

Coyote said it asked for the SEC's involvement after the financial Web site TheStreet.com reported last week that its reporters could not locate Coyote's largest client. The online publication also noted that some Coyote insiders had recently registered to sell shares in the firm. The news sent Coyote stock down sharply, dropping 54 percent between Wednesday and Friday on exceptionally heavy volume.

In addition to contacting the SEC, Coyote on Monday also invited James Cramer, a co-chairman of TheStreet.com, to meet with company officials later this week at an engineering center in Texas to learn more about the firm. Coyote officials say they believe TheStreet.com's coverage was potentially misleading and incomplete.

Kaufman Bros., L.P., analyst Vik Grover said both moves should reassure investors. ``Typically, fraudulent companies don't go running to the SEC to ask for help,'' Grover said.

TheStreet.com said it stands by its original stories, though editor Dave Kansas said his reporters subsequently located the Coyote client, Crescent Communications, which indirectly accounted for most of Coyote's second-quarter revenue. Coyote said it sold $12 million worth of equipment to Comdisco, which leased it to Crescent.

Kansas said it was unlikely Cramer would meet with Coyote management this week.

In what it said was unrelated news, Coyote also announced the appointment of a new chief financial officer, Brian Robson, following the departure of Edward Beeman from that spot a month ago. Company spokesman Tom Wright said state privacy laws prevent him from discussing why Beeman left Coyote after approximately three months on the job.