The SEC recently charged a former employee of a biopharmaceutical company with insider trading in advance of an acquisition but with a unique twist: Trading the securities of a company unrelated to the merger. ...more
8/25/2021
/ Acquisition Agreements ,
Enforcement Actions ,
Insider Trading ,
Misappropriation ,
Securities and Exchange Commission (SEC) ,
Securities Fraud ,
Securities Litigation ,
Securities Transactions ,
Securities Violations ,
Stock Options ,
Stock Prices
The U.S. Court of Appeals for the First Circuit held yesterday that the U.S. securities laws apply to foreign brokers’ solicitations of securities purchases by foreign investors if the purchasers or sellers incurred...more
This yearly report provides a summary of some of the significant changes and developments that occurred in the past year in the hedge fund and private equity spaces, as well as certain recommended practices that investment...more
The U.S. Court of Appeals for the Second Circuit reaffirmed yesterday that the federal securities laws do not apply to “predominantly foreign” securities transactions even if those transactions might have taken place in the...more
The Second Circuit held earlier this week that the criminal statute proscribing securities fraud permits convictions for insider trading without proof that the provider of material, nonpublic information received a personal...more
1/2/2020
/ Breach of Duty ,
Centers for Medicare & Medicaid Services (CMS) ,
Confidential Information ,
Duty of Trust ,
Enforcement Actions ,
EU Market Abuse Regulation (EU MAR) ,
Illegal Tipping ,
Insider Trading ,
Material Nonpublic Information ,
Personal Benefit ,
Rule 10(b) ,
Securities and Exchange Commission (SEC) ,
Securities Exchange Act ,
Securities Fraud ,
Wire Fraud
Since the Second Circuit’s 2014 decision in United States v. Newman triggered a debate about the personal benefit requirement, several bills have been introduced in Congress to define insider trading. The most recent effort...more
The Supreme Court held today that persons who do not “make” material misstatements or omissions, but who disseminate them to potential investors with fraudulent intent, can be held to have violated other provisions of the...more
4/1/2019
/ Appeals ,
Enforcement Actions ,
False Statements ,
Fines ,
Intent to Defraud ,
Investment Banks ,
Lorenzo v SEC ,
Material Dissemination ,
Misleading Statements ,
Reaffirmation ,
Rule 10b-5 ,
SCOTUS ,
Securities and Exchange Commission (SEC) ,
Securities Violations ,
Suspensions
The Court of Appeals for the Tenth Circuit held today that the Securities and Exchange Commission may bring an enforcement action based on allegedly foreign securities transactions involving non-U.S. residents if sufficient...more
1/25/2019
/ Dodd-Frank ,
Enforcement Actions ,
Extraterritoriality Rules ,
Foreign Investment ,
Jurisdiction ,
Morrison v National Australia Bank ,
Ponzi Scheme ,
Securities and Exchange Commission (SEC) ,
Securities Exchange Act ,
Securities Violations ,
Subject Matter Jurisdiction
The Fourth Circuit ruled yesterday that a plaintiff can sufficiently plead loss causation to establish a securities-fraud claim based on an “amalgam” of two theories: corrective disclosure, and materialization of a concealed...more
2/27/2018
/ Disclosure Requirements ,
False Claims Act (FCA) ,
Form 8-K ,
Healthcare Fraud ,
Internal Investigations ,
Loss Causation ,
Material Misrepresentation ,
Qui Tam ,
Securities and Exchange Commission (SEC) ,
Securities Fraud ,
Subpoenas
A federal court in Utah recently held that the Securities and Exchange Commission may bring an enforcement action based on allegedly foreign securities transactions involving non-U.S. residents if sufficient conduct occurred...more
4/6/2017
/ Conduct and Effects Test ,
Dodd-Frank ,
Enforcement Actions ,
Extraterritoriality Rules ,
Foreign Issuers ,
Interlocutory Appeals ,
Jurisdiction ,
Morrison v National Australia Bank ,
Ponzi Scheme ,
Securities Act of 1933 ,
Securities and Exchange Commission (SEC) ,
Securities Exchange Act ,
Securities Violations
A Pennsylvania federal court held yesterday that an agreement not to use confidential inside information for trading purposes need not precede the receipt of that information in order to create liability under the...more
3/22/2017
/ Buyers ,
Confidential Information ,
Confidentiality Agreements ,
Duty of Trust ,
Enforcement Actions ,
Federal Pleading Requirements ,
Insider Trading ,
Investment Adviser ,
Misappropriation ,
Motion to Dismiss ,
Rule 10b-5 ,
Securities ,
Securities and Exchange Commission (SEC) ,
Securities Litigation ,
Sellers
U.S. District Judge Jed Rakoff denied motions for judgment as a matter of law or for a new trial after a jury found the defendants civilly liable for insider trading. The decision in SEC v. Payton (S.D.N.Y. Nov. 29, 2016)...more
This special report provides a summary of some of the significant changes and developments that occurred in the past year in the private equity and hedge funds space, as well as certain recommended practices that investment...more
11/16/2016
/ Accredited Investors ,
Administrative Law Judge (ALJ) ,
Administrative Proceedings ,
Annual Reports ,
Brazil ,
Broker-Dealer ,
Business Continuity Plans ,
CFTC ,
China ,
Compensation Agreements ,
Constitutional Challenges ,
Cybersecurity ,
Defend Trade Secrets Act (DTSA) ,
Department of Justice (DOJ) ,
EEO-1 ,
Employee Retirement Income Security Act (ERISA) ,
Enforcement Actions ,
Equal Employment Opportunity Commission (EEOC) ,
Estate Planning ,
EU ,
European Securities and Markets Authority (ESMA) ,
Fair Labor Standards Act (FLSA) ,
Filing Requirements ,
Financial Conduct Authority (FCA) ,
Financial Industry Regulatory Authority (FINRA) ,
Financial Institutions ,
Financial Markets ,
Foreign Corrupt Practices Act (FCPA) ,
Form ADV ,
Hedge Funds ,
High Net-Worth ,
Hong Kong ,
Insider Trading ,
Insurance Industry ,
Liability Insurance ,
MiFID II ,
Minimum Salary ,
OCIE ,
Over-Time ,
Popular ,
Private Equity Funds ,
Private Investment Funds ,
Proposed Amendments ,
Protecting Americans from Tax Hikes (PATH) Act ,
Regulation AT ,
Regulatory Oversight ,
Required Forms ,
Retirement Plan ,
Rule 506(d) ,
SEC Examination Priorities ,
Securities and Exchange Commission (SEC) ,
Separation Agreement ,
Tax Returns ,
UK Brexit ,
Unemployment Benefits ,
Valuation ,
Whistleblowers ,
White-Collar Exemptions
The U.S. Court of Appeals for the Ninth Circuit held today that the Sarbanes-Oxley Act’s disgorgement provision – which requires disgorgement of certain CEO and CFO compensation when an issuer restates its financial...more
On July 13, 2016, the SEC announced that it will adopt certain amendments to its rules of practice governing administrative proceedings. Faced with criticism from practitioners and the media regarding a perceived “home field...more
On May 26, 2016, the U.S. Court of Appeals for the First Circuit held that friends’ gifts of wine, steak dinners, and other luxury items can constitute the types of personal benefit needed to establish a breach of duty in...more
5/27/2016
/ Breach of Duty ,
Confidential Information ,
Criminal Prosecution ,
Fiduciary Duty ,
Illegal Tipping ,
Insider Trading ,
Material Nonpublic Information ,
Mens Rea ,
Misappropriation ,
Personal Benefit ,
Scienter ,
Securities and Exchange Commission (SEC) ,
US v Newman ,
US v Salman
Cornerstone Research’s latest annual report discloses that the number and average size of securities class-action settlements increased in 2015 as compared to 2014. Total settlement dollars rose to more than $3 billion –...more
The Second Circuit held yesterday that Item 303 of SEC Regulation S-K requires issuers to disclose only those trends, events, or uncertainties about which the issuer has actual knowledge, rather than those matters about which...more
Proskauer has released the 2015 Proskauer Annual Review and Outlook for Hedge, Private Equity and Other Private Funds. The 88-page report is a summary of significant legal changes and developments in the private funds space...more
11/25/2015
/ China ,
Cybersecurity ,
EU ,
Gift Tax ,
Hedge Funds ,
Hong Kong ,
Internships ,
Popular ,
Private Equity ,
Private Funds ,
Registered Investment Advisors ,
Securities and Exchange Commission (SEC) ,
UK ,
Volcker Rule ,
Whistleblowers
The U.S. Court of Appeals for the District of Columbia Circuit held today that federal District Courts do not have subject-matter jurisdiction to entertain challenges to ongoing SEC administrative enforcement proceedings. A...more
9/30/2015
/ Administrative Proceedings ,
Article III ,
De Novo Standard of Review ,
Due Process ,
Enforcement ,
Equal Protection ,
Judicial Review ,
Non-Delegation Doctrine ,
Preemption ,
Securities and Exchange Commission (SEC) ,
Separation of Powers ,
Standing ,
Subject Matter Jurisdiction
The Securities and Exchange Commission appears to be hearing the music. In response to the many voices that have expressed dissatisfaction with the procedures used in SEC administrative hearings, the SEC today issued proposed...more
9/25/2015
/ Administrative Appeals ,
Administrative Hearings ,
Administrative Proceedings ,
Amended Regulation ,
Comment Period ,
Depositions ,
Discovery ,
Federal Rules of Civil Procedure ,
Notice and Comment ,
Proposed Regulation ,
Securities and Exchange Commission (SEC)
The Securities and Exchange Commission again rejected constitutional challenges to the use of administrative enforcement proceedings presided over by Administrative Law Judges (“ALJs”). The Commission’s September 17, 2015...more
9/24/2015
/ Administrative Law Judge (ALJ) ,
Administrative Proceedings ,
Appointments Clause ,
Article II ,
Corporate Counsel ,
Enforcement Actions ,
Equal Protection ,
Jurisdiction ,
PCAOB ,
Registered Investment Advisors ,
Securities and Exchange Commission (SEC)
The Securities and Exchange Commission joined the raging debate about whether SEC administrative proceedings conducted by administrative law judges (“ALJs”) are unconstitutional if the ALJs have not been appointed in...more
The U.S. Court of Appeals for the Seventh Circuit held yesterday that federal District Courts do not have subject-matter jurisdiction to entertain challenges to ongoing SEC administrative enforcement proceedings where the...more
8/27/2015
/ Article II ,
Bebo v SEC ,
Cease and Desist ,
De Novo Standard of Review ,
Dodd-Frank ,
Due Process ,
Enforcement Actions ,
Equal Protection ,
Fifth Amendment ,
Securities and Exchange Commission (SEC) ,
Subject Matter Jurisdiction
We blogged last week about a New York federal court’s decision in Duka v. SEC conditionally sustaining a facial challenge to an administrative enforcement proceeding conducted by Administrative Law Judges (“ALJs”) of the...more