Insider Trading Enforcement Actions

News & Analysis as of

This Week In Securities Litigation

The Government requested that the Supreme Court overturn U.S. v. Newman, the Second Circuit’s decision on tipping and the personal benefit test. Previously, the Second Circuit had declined a request to either rehear the case...more

You Can Settle Your Insider Trading Case with a Negligence-based Charge

This is almost certainly not true anymore. But it was true once! Maybe only once. Back in October 1991, the SEC sued Shared Medical Systems, a Pennsylvania health care information services company and three of its officers...more

Bridging the Week - July 2015 #3

Et tu, CFE? CBOE Futures Proposes Amended Disruptive Practices Rules and New Related Policies and Procedures: CBOE Futures Exchange became the latest designated contract market to propose specific rules to ban disruptive...more

This Week In Securities Litigation

The U.S. Chamber of Commerce published a report containing a series of recommendations regarding the SEC’s Enforcement program. Several recommendations focused on the use of administrative proceedings, including one which...more

An Example of Cooperation Credit From The SEC

DOJ and SEC officials repeatedly encourage cooperation. There are benefits for both sides. Cooperation can facilitate the Government’s investigation, providing a road to the scheme. Testimony can aid in obtaining a favorable...more

The Circuits Are Split: Are Tangible Benefits Required for Insider Trading Liability?

The Ninth Circuit’s recent decision calls into question the Second Circuit’s definition of “personal benefit” for insider trading liability in criminal prosecutions. On July 6, 2015, United States District Court Judge...more

This Week In Securities Litigation

The Ninth Circuit upheld a conviction for illegal tipping, following Dirks but raising doubt regarding its adherence to Newman in an opinion authored by Judge Rakoff, sitting by designation. The Commission filed settled...more

SEC Files It's First Robocop Cherry Picking Action

When the SEC announced it financial fraud task force and a related data initiative to facilitate the identification of situations where the company “cooked the books,” many dubbed the data program “Robocop.” While the SEC may...more

SEC Files Another Suspicious Trading Case

Outsized trades continue to draw SEC scrutiny and enforcement actions – even where the agency does not have the evidence to fully plead a claim. Despite the difficulties of these so-called “suspicious” trading cases, in many...more

California Brokers Plead Guilty to Insider Trading of Ardea Biosciences, Inc. Stock

On June 9, Chad Wiegand and Akis Eracleous, two San-Diego based brokers, pled guilty in California district court to trading in Ardea Biosciences, Inc. stock with inside information. Mr. Wiegand and Mr. Eracleous,...more

This Week In Securities Litigation

The Commission chose to appeal the decision in Hill v. SEC in which the Court held that the manner in which SEC Administrative Law Judges are retained violates the Appointment Clause of the Constitution. While the Court...more

Hong Kong Regulatory Update - June 2015

This Hong Kong regulatory update is intended to provide a brief overview of the principal Hong Kong regulatory developments in the preceding three months relevant to companies listed or proposed to be listed on The Stock...more

SEC Files Settled Insider Trading Case As Administrative Proceeding

One question in the wake of the Second Circuit’s decision in Newman regarding the personal benefit test for illegal tipping has been how the SEC would respond to a decision the U.S. Attorney told the Court would significantly...more

SEC Settles Another Insider Trading Case Tied To Brocade Deal

The acquisition of Foundry Networks, Inc., a networking hardware company, by Brocade Communications System, Inc., a technology company specializing in data and storage networking products, announced on July 21, 2008, has...more

This Week In Securities Litigation

The question of forum selection by the SEC was a key issue this week. While to date suits challenging the SEC’s right to bring an action as an administrative proceeding rather than in federal court have had little success –...more

SEC, USAO File Parallel Insider Trading Charges

The SEC brought an insider trading case against a senior corporate official and a chain of tippes that starts with his brother-in-law broker who then tipped his friend, another broker. Others, not named as defendants, were...more

Another SEC Insider Trading Case: Does it Comply With Newman?

The SEC continues to bolster its allegations regarding the relationships between tipper and tippee in insider trading cases as well as the knowledge of the tippee. Whether those allegations will be sufficient to meet the...more

Court Enters Preliminary Injunction Against SEC Administrative Proceeding

The United States District Court for the Northern District of Georgia, Atlanta Division, has entered a preliminary injunction preventing the SEC from conducting an administrative proceeding in an insider trading matter. The...more

The Impact of Newman on SEC Enforcement: Part V

This is the fifth and concluding segment of a five part series discussing the impact of the Second Circuit’s ruling in Newman on SEC insider trading cases. Analysis - The impact of Newman on the SEC and the DOJ may...more

The Impact of Newman on SEC Enforcement: Part IV

This is the fourth segment of a five part series discussing the impact of the Second Circuit’s ruling in Newman on SEC insider trading cases. Post Newman SEC Actions (continued) - 2. Administrative proceedings...more

The Impact of Newman on SEC Enforcement: Part II

This is the second segment of a five part series discussing the impact of the Second Circuit’s ruling in Newman on SEC insider trading cases. The Immediate Impact of Newman - The most immediate impact of Newman is...more

Asset Management Firms And The Risk Of Market Abuse: Key Practical Points From The FCA's Thematic Review Feedback And Recent FCA...

Tackling market abuse continues to be a strategic priority for the FCA. In late 2014, the FCA undertook a thematic review into asset management firms and the risk of market abuse, the results of which were published in...more

Business Litigation Report - April 2015

In This Issue: - Main Article: ..Insider Trading After United States v. Newman, the Second Circuit’s Landmark Decision Limiting Liability of Downstream Recipients of Insider Information - Noted With...more

FCA Fines Individual For Committing Market Abuse Based On Information Provided By A Third Party

We consider here the FCA's enforcement action against Kenneth Carver for committing market abuse (insider dealing) in breach of section 118(2) of the Financial Services and Markets Act 2000 (FSMA) when purchasing shares on...more

Insider Trading After United States v. Newman, the Second Circuit’s Landmark Decision Limiting Liability of Downstream Recipients...

The Second Circuit recently dealt a major setback to federal prosecutors’ recent crackdown on insider trading, overturning two high-profile convictions and simultaneously placing the most significant new limits on insider...more

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