David Smyth

David Smyth

Brooks Pierce

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Three Thoughts about FINRA’s Weird Japanese Insider Trading Case

One of the things you’re not supposed to do if you’re in the securities business – or any business, really – is buy and sell securities on the basis of material, nonpublic information in breach of a duty not to do so. The...more

7/15/2014 - Enforcement Actions FINRA Fraud Insider Trading Japan Popular SEC

Give Me That Old-Time Insider Trading

Recently I had a question that required me to review Don Langevoort’s comprehensive insider trading treatise. It got me thinking about the roots of insider trading law. Specifically, the pre-SEC, pre-10b-5 insider trading...more

4/11/2014 - Business Torts Corporate Officers Insider Trading Rule 10b-5 Securities Litigation Shareholders

The SEC Will Take “Your” Money, Thanks

So let’s say you work for a hedge fund or some other financial institution that engages in proprietary trading , and you’re inclined to do some insider trading on your employer’s behalf. You make your trades, but you’re a...more

3/11/2014 - Compliance Insider Trading Proprietary Trading SEC Securities Exchange Act

Two Thoughts about the Jury Verdict in SEC v. Steffes

As you may have heard by now, on January 27th a jury in the Northern District of Illinois sided with the defendants and against the SEC in an aggressive insider trading case. Here were the facts as alleged by the SEC and...more

2/19/2014 - Acquisitions Insider Trading SEC

SEC Charges Hao He with Insider Trading, for Some Reason or Another

Here are two things about insider trading law: First, it’s hard to know exactly what the parameters are. The United States doesn’t have a specific statute prohibiting it. It grows out of the general anti-fraud provisions...more

2/10/2014 - Fraud Insider Trading SEC Securities Act of 1933 Securities Exchange Act

S.D.N.Y. Prosecutors Get Martoma, but Probably No Closer to Steve Cohen

Lst Thursday, a jury in the Southern District of New York convicted Mathew Martoma in what is in dollar terms the largest insider trading case in captivity. As we’ve discussed before, Martoma had been accused of paying a...more

2/10/2014 - Insider Trading Martoma SAC Capital Steve Cohen Wyeth

Prosecutors Trying to Get Martoma Wackiness into Evidence By Hook or by Crook

So I’m at my desk the other day, minding my own business, when I read on the Twitter, “Ex-SAC Trader Expelled from Harvard Law School” or some such. The article explained the 1999 expulsion of Mathew Martoma, who is...more

1/16/2014 - Evidence Fraud Insider Trading Rule 404(b) Rule 608

Criminal Forfeiture and SAC Capital

As you probably know, federal prosecutors indicted SAC Capital Advisors LP and a number of related entities last Thursday on wire fraud and securities fraud charges connected to its alleged insider trading over the last five...more

7/31/2013 - Civil Forfeiture Forfeiture Insider Trading SAC Capital Securities Securities Fraud Steve Cohen Wire Fraud

Three Thoughts about Steve Cohen’s Failure-to-Supervise Case

Stanley Sporkin — former SEC Enforcement Director, CIA general counsel, and federal judge – likes to say that an SEC staff attorney ought to be just as happy closing an investigation as one is bringing a public enforcement...more

7/26/2013 - Administrative Hearings Fraud Insider Trading Negligent Supervision Rule 10b-5 Sanctions SEC Steve Cohen Supervision White Collar Crimes

Companies Finding Little Use for Quick, Efficient Way to Avoid Liability

When I was on the SEC’s enforcement staff, I had a case once where we were pretty sure our prospective defendant had engaged in insider trading. Our conversation with his lawyer went something like this...more

6/14/2013 - 10b5-1 Plans Insider Trading SEC

SEC Sues Badin for Insider Trading in Smithfield Foods Acquisition

The May 29th announcement that China-based Shuanghui International Holdings had agreed to acquire Virginia-based Smithfield Foods came with a lot of news value. First, the $4.7 billion price tag for Smithfield is large by any...more

6/7/2013 - China Insider Trading SEC Smithfield Foods

Remote Tippee Issues Hang over SEC/Wells Fargo Insider Trading Case

The SEC brought a big insider trading case against a number of individuals in the Western District of North Carolina yesterday. The complaint alleges $11 million in illicit profits. The complaint calls it an insider...more

12/6/2012 - Insider Trading SEC

Several Thoughts about the Largest Insider Trading Case in History

The SEC and Justice Department filed a massive insider trading case in the Southern District of New York yesterday. The actual defendants include University of Michigan neurology professor Sidney Gilman, hedge fund advisory...more

11/21/2012 - Insider Trading SEC

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