The Experts below are selected from a list of 867 Experts worldwide ranked by ideXlab platform
Joan Macleod Heminway - One of the best experts on this subject based on the ideXlab platform.
-
Tipper/Tippee Insider Trading as Unlawful Deceptive Conduct: Insider Gifts of Material Nonpublic Information to Strangers
2018Co-Authors: Joan Macleod HeminwayAbstract:What would the world look like if a public company officer or director, recognizing the value inherent in material Nonpublic firm Information and intending to benefit people of limited means, gave this valuable Information to those less fortunate without the knowledge or consent of the firm and without any expectation of benefit in return? How, if at all, do we desire to regulate that behavior? The officer or director apparently would be in breach of his or her fiduciary duty absent a valid, binding, and enforceable agreement to the contrary. Does that conduct also, however, violate U.S. federal insider trading rules? Should it? This article offers answers to those questions. Many (if not most) market observers, including some familiar with U.S. insider trading regulation, would classify the conduct of the officer or director, as tipper, as unlawful under insider trading rules. Yet, a strict doctrinal analysis under Section 10(b) of, and Rule 10b-5 under, the Securities Exchange Act of 1934 calls that classification into doubt. This article not only offers an analysis of the posited altruistic gift-to-strangers scenario under existing federal insider trading law, but also presents doctrinal and normative approaches to the insider trading liability question that yield results consonant with the likely majoritarian conclusion that the tipping insider has committed an insider trading violation under Section 10(b) and Rule 10b-5.
-
tipper tippee insider trading as unlawful deceptive conduct insider gifts of material Nonpublic Information to strangers
Washington University Journal of Law and Policy, 2018Co-Authors: Joan Macleod HeminwayAbstract:What would the world look like if a public company officer or director, recognizing the value inherent in material Nonpublic firm Information and intending to benefit people of limited means, gave this valuable Information to those less fortunate without the knowledge or consent of the firm and without any expectation of benefit in return? How, if at all, do we desire to regulate that behavior? The officer or director apparently would be in breach of his or her fiduciary duty absent a valid, binding, and enforceable agreement to the contrary. Does that conduct also, however, violate U.S. federal insider trading rules? Should it? This article offers answers to those questions. Many (if not most) market observers, including some familiar with U.S. insider trading regulation, would classify the conduct of the officer or director, as tipper, as unlawful under insider trading rules. Yet, a strict doctrinal analysis under Section 10(b) of, and Rule 10b-5 under, the Securities Exchange Act of 1934 calls that classification into doubt. This article not only offers an analysis of the posited altruistic gift-to-strangers scenario under existing federal insider trading law, but also presents doctrinal and normative approaches to the insider trading liability question that yield results consonant with the likely majoritarian conclusion that the tipping insider has committed an insider trading violation under Section 10(b) and Rule 10b-5.
-
Not) Holding Firms Criminally Responsible for the Reckless Insider Trading of Their Employees
2017Co-Authors: Joan Macleod HeminwayAbstract:Criminal enforcement of the insider trading prohibitions under Section 10(b) and Rule 10b-5 is the root of corporate criminal liability for insider trading in the United States. In the wake of assertions that S.A.C. Capital Advisors, L.P. actively encouraged the unlawful use of material Nonpublic Information in the conduct of its business, the line between employer and employee criminal liability for insider trading becomes both tenuous and salient. An essential question emerges: when do we criminally prosecute the firm for the unlawful conduct of its employees? The possibility that reckless employee conduct may result in the employer's willful violation of Section 10(b) and Rule 10b-5 (and, therefore, criminal liability for that employer firm) motivates this article. The article first reviews the basis for criminal enforcement of the insider trading prohibitions established in Section 10(b) and Rule 10b-5 and describes the basis and rationale for corporate criminal liability (a liability that derives from the activities of agents undertaken in the course of the firm’s business). Then, it reflects on that basis and rationale by identifying the potential for corporate criminal liability for the reckless insider trading violations of employees under Section 10(b) and Rule 10b-5, arguing against that liability, and suggesting ways to eliminate it.
-
Common Roots, Divergent Evolution: Insider Trading Doctrine in the United States, Japan, and Germany
SSRN Electronic Journal, 2009Co-Authors: Joan Macleod HeminwayAbstract:Many nations ostensibly use (or at least credit) U.S. insider trading doctrine under Rule 10b-5 as the model for their own regulation of insider trading. This phenomenon has occurred in part because of historical and political factors and in part because the United States is seen as (and has wielded regulatory power as) a market leader — an early adopter of regulation with both (a) a well established supervisory and policy-oriented regulatory and enforcement agency and (b) a well developed, disaggregated, public securities market. As a result, the laws of many countries now prohibit identified classes of persons from trading while in possession of material Nonpublic Information, the central focus of insider trading regulation under Rule 10b-5. Yet, despite seemingly convergent beginnings and a general agreement on the nature of the regulated conduct, operative insider trading principles in the United States (as a rule originator) have evolved to protect different interests and regulate different specific market activities than insider trading rules in other countries. With the foregoing in mind, this working paper describes the common roots and divergent developmental paths of insider trading rules in the United States, Japan, and Germany and endeavors to place them in a meaningful international legal, political, economic, and social context.
Mark J. Ratain - One of the best experts on this subject based on the ideXlab platform.
-
Oncology Micro-Cap Stocks: Caveat Emptor!
2016Co-Authors: Adam Feuerstein, Mark J. RatainAbstract:Trading based on material Nonpublic Information is a criminal violation of the Federal Securities Exchange Act of 1934 and is punishable by a maximum sentence of 20 years and a fine of $5 million. Thus, the suggestion by Rothenstein et al. (1) in this issue of the Journal that insider trading is the cause of observed differences in company stock prices before and after public announcements related to oncology drugs is of grave concern. Specifically, Rothenstein et al. (1) analyzed the stock prices in the 120 days leading up to public announcements regarding phase III trials, and they appear to reject the null hypothesis that the outcome of the trial is unrelated to the stock price behavior before the announcement. Indeed, companies that reported a positive trial demonstrated better price performance (an increase of approximately 14%) during that period compared with companie
-
Oncology Micro-Cap Stocks: Caveat Emptor!
Journal of the National Cancer Institute, 2011Co-Authors: Adam Feuerstein, Mark J. RatainAbstract:JNCI Vol. 103, Issue 20 | October 19, 2011 Trading based on material Nonpublic Information is a criminal violation of the Federal Securities Exchange Act of 1934 and is punishable by a maximum sentence of 20 years and a fine of $5 million. Thus, the suggestion by Rothenstein et al. (1) in this issue of the Journal that insider trading is the cause of observed differences in company stock prices before and after public announcements related to oncology drugs is of grave concern. Specifically, Rothenstein et al. (1) analyzed the stock prices in the 120 days leading up to public announcements regarding phase III trials, and they appear to reject the null hypothesis that the outcome of the trial is unrelated to the stock price behavior before the announcement. Indeed, companies that reported a positive trial demonstrated better price performance (an increase of approximately 14%) during that period compared with companies Oncology Micro-Cap Stocks: Caveat Emptor!
Dombalagian, Onnig H. - One of the best experts on this subject based on the ideXlab platform.
-
\u3cem\u3eTexas Gulf Sulphur\u3c/em\u3e and Information Disclosure Policy
SMU Scholar, 2018Co-Authors: Dombalagian, Onnig H.Abstract:Texas Gulf Sulphur’s bold ultimatum— disclose or abstain”— enjoys an enduring place of prominence in discussions of insider trading law be- cause of the intuitive simplicity with which it asserts the expectations of investors in securities markets. As the law of Information dissemination has developed into a distinct subset of federal securities law over the past fifty years, however, it is equally important to reflect on how the Texas Gulf Sulphur opinion has shaped the views of courts and regulators in crafting rules and guidelines for Information disclosure. Indeed, Texas Gulf Sulphur anticipated—and continues to inform—contemporary debates relating to the dissemination of real-time material Information, including questions such as how and how much material, Nonpublic Information should be disclosed to the public, who is in a position to make effective “disclosures” that satisfy the “disclose or abstain” rule, and the standard for determining when new Information may be acted upon by insiders. Even as its influence over insider trading doctrine has waned, Texas Gulf Sulphur’s aspirational standard of “equal access to material Information” continues to fuel the imagination of investors and policy makers in regulating twenty-first century securities markets
Manning G. - One of the best experts on this subject based on the ideXlab platform.
-
A Birthday Toast to \u3cem\u3eTexas Gulf Sulphur\u3c/em\u3e
SMU Scholar, 2018Co-Authors: Manning G.Abstract:This article commemorates the fiftieth anniversary of the Second Circuit’s Texas Gulf Sulphur decision by examining the impact of the case on insider trading law in the United States. The author begins by discussing the SEC’s opinion, In the Matter of Cady, Roberts & Co., which laid the foundation for the Texas Gulf Sulphur decision by creating a federal duty to disclose material Nonpublic Information or abstain from trading securities. The author then posits that the SEC, in its Cady, Roberts decision, rejected judicially developed common law fiduciary duty to disclose based on trust and confidence, and, by administrative fiat, substituted a broader federal duty of disclosure centered on access and unfairness. Next, the article examines how the Cady, Roberts decision would fair under the Supreme Court’s modern insider trading law. Finally, the article concludes with a discussion of the court’s adoption of a new federal duty of disclosure in Texas Gulf Sulphur
Adam Feuerstein - One of the best experts on this subject based on the ideXlab platform.
-
Oncology Micro-Cap Stocks: Caveat Emptor!
2016Co-Authors: Adam Feuerstein, Mark J. RatainAbstract:Trading based on material Nonpublic Information is a criminal violation of the Federal Securities Exchange Act of 1934 and is punishable by a maximum sentence of 20 years and a fine of $5 million. Thus, the suggestion by Rothenstein et al. (1) in this issue of the Journal that insider trading is the cause of observed differences in company stock prices before and after public announcements related to oncology drugs is of grave concern. Specifically, Rothenstein et al. (1) analyzed the stock prices in the 120 days leading up to public announcements regarding phase III trials, and they appear to reject the null hypothesis that the outcome of the trial is unrelated to the stock price behavior before the announcement. Indeed, companies that reported a positive trial demonstrated better price performance (an increase of approximately 14%) during that period compared with companie
-
Oncology Micro-Cap Stocks: Caveat Emptor!
Journal of the National Cancer Institute, 2011Co-Authors: Adam Feuerstein, Mark J. RatainAbstract:JNCI Vol. 103, Issue 20 | October 19, 2011 Trading based on material Nonpublic Information is a criminal violation of the Federal Securities Exchange Act of 1934 and is punishable by a maximum sentence of 20 years and a fine of $5 million. Thus, the suggestion by Rothenstein et al. (1) in this issue of the Journal that insider trading is the cause of observed differences in company stock prices before and after public announcements related to oncology drugs is of grave concern. Specifically, Rothenstein et al. (1) analyzed the stock prices in the 120 days leading up to public announcements regarding phase III trials, and they appear to reject the null hypothesis that the outcome of the trial is unrelated to the stock price behavior before the announcement. Indeed, companies that reported a positive trial demonstrated better price performance (an increase of approximately 14%) during that period compared with companies Oncology Micro-Cap Stocks: Caveat Emptor!
