In Dreiling v. America Online, Inc., 2009 WL 2516325 (9th Cir. May 5, 2009), the United States Court of Appeals for the Ninth Circuit held that Section 16(b) of the Securities Exchange Act of 1934 — which, broadly speaking is intended to "prevent corporate insiders from exploiting their access to information not generally available to others" by requiring disgorgement of short-swing profits from trading in securities — did not "provide a private litigant with another means of litigating securities fraud" that are prohibited under Section 10(b) and Rule 10b-5. The Court held further that a company and an individual acting on behalf of a different company who participated in "negotiations that result[ed] in the formation of a business agreement between two companies" was insufficient to create the sort of agreement necessary to establish that they were a group of "insiders" for the purpose of Section 16(b). The Ninth Circuit, therefore, rejected plaintiff‘s novel attempt to expand the reach and scope of liability under Section 16(b).
Please see full article below for more information.
Firefox recommends the PDF Plugin for Mac OS X for viewing PDF documents in your browser.
We can also show you Legal Updates using the Google Viewer; however, you will need to be logged into Google Docs to view them.
Please choose one of the above to proceed!
LOADING PDF: If there are any problems, click here to download the file.