DOCSLIB.ORG

Abandoning the Personal Benefit Requirement in Insider Trading Law

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text
Abandoning the Personal Benefit Requirement in Insider Trading Law University of Michigan Journal of Law Reform Volume 50 2016 No More Quid Pro Quo: Abandoning the Personal Benefit Requirement in Insider Trading Law Shannon Seiferth University of Michigan Law School Follow this and additional works at: https://repository.law.umich.edu/mjlr Part of the Courts Commons, Legislation Commons, Securities Law Commons, and the Supreme Court of the United States Commons Recommended Citation Shannon Seiferth, No More Quid Pro Quo: Abandoning the Personal Benefit Requirement in Insider Trading Law, 50 U. MICH. J. L. REFORM 175 (2016). Available at: https://repository.law.umich.edu/mjlr/vol50/iss1/4 This Note is brought to you for free and open access by the University of Michigan Journal of Law Reform at University of Michigan Law School Scholarship Repository. It has been accepted for inclusion in University of Michigan Journal of Law Reform by an authorized editor of University of Michigan Law School Scholarship Repository. For more information, please contact [email protected]. NO MORE QUID PRO QUO: ABANDONING THE PERSONAL BENEFIT REQUIREMENT IN INSIDER TRADING LAW Shannon Seiferth* ABSTRACT A circuit split between the Second Circuit’s 2014 decision, United States v. New- man, and the Ninth Circuit’s 2015 decision, United States v. Salman, illustrates problems in insider trading law dating back over thirty years to the Supreme Court’s decision in Dirks v. SEC. Dirks held that when a corporate insider provides information to an outside party who then trades on the information, it must be shown that the insider received some form of a personal benefit for providing the information in order to impute liability. The courts in Newman and Salman dis- agreed on the sort of evidence that suffices to prove such a personal benefit. As this question is set to be decided by the Supreme Court, these cases provide an apt oppor- tunity for reexamining the law of insider trading. Although it might be argued that, for both moral and efficiency reasons, the courts in Newman and Salman reached the right outcome, the analysis in both decisions was strained as a result of the personal benefit requirement first articu- lated in Dirks. As this Note discusses, this split demonstrates that proof of a personal benefit as an element of insider trading in tipper/tippee cases should not be required, as it creates unnecessarily subjective inquiries into the relationship between the tipper and tippee, resulting in confusion in the boundaries of permissi- ble trading activity. Because insider trading walks a fine line between behavior that should be encouraged (the use of information for legitimate business purposes) and discouraged (exploiting information obtained by virtue of an inside position for personal gain), it is important to more clearly define the bounds of insider trading activity. In place of requiring proof of a personal benefit, this Note argues that a wholly new statutory approach to insider trading is warranted and offers an alter- native statutory proposal that may serve as a starting point for a discussion of adopting legislation. INTRODUCTION The Second Circuit’s 2014 decision in United States v. Newman1 became one of the most significant insider trading cases in recent * J.D. Candidate, University of Michigan Law School, December 2016; B.A., University of Michigan, 2012. I would like to thank Professor Adam C. Pritchard for many helpful discussions and insights and my fellow Journal of Law Reform editors for their invaluable feedback. 1. United States v. Newman, 773 F.3d 438 (2d Cir. 2014), cert. denied, 136 S. Ct. 242 (2015). 175 176 University of Michigan Journal of Law Reform [VOL. 50:1 years, resulting in prompt backlash from the media,2 an appeal to the Supreme Court,3 two legislative proposals to overhaul insider trading law,4 and a Ninth Circuit decision, United States v. Salman, explicitly declining to follow the holding of Newman.5 The key dis- pute between the courts in Newman and Salman dates back to the Supreme Court’s 1983 decision in Dirks v. SEC, which held that when a corporate insider provides information to an outside party who then trades on the information, it must be shown that the in- sider received some form of a personal benefit for providing the information in order to constitute insider trading.6 While Newman interpreted this element to require proof that the insider received a benefit greater than an ephemeral friendship,7 Salman held that ev- idence of a friendship or close family relationship might be sufficient to satisfy the personal benefit element.8 Though New- man’s requirement of a tangible benefit attempts to escape subjective inquiries into the closeness of a relationship, it could leave morally reprehensible trading behavior unchecked. The Supreme Court granted certiorari in Salman to the question of whether proof of an objective personal benefit, which “repre- sents at least a potential gain of a pecuniary or similarly valuable nature,” is needed to establish insider trading.9 Oral argument took place October 5, 2016 and a ruling will be issued by June 2017.10 Even if the Court adopts the defendant’s view that insider trading should require proof of an objective personal benefit, these cases provide an apt opportunity for reexamining the law of insider trading. The dispute between the Second and Ninth Circuits in Newman and Salman is emblematic of larger fissures in the law of insider 2. See Greg Stohr & Patricia Hurtado, Insider Trading Cases Imperiled as U.S. Supreme Court Spurns Appeal, BLOOMBERG (Oct. 5, 2015, 9:31 AM), http://www.bloomberg.com/news/arti cles/2015-10-05/insider-trading-cases-imperiled-as-top-u-s-court-spurns-appeal. 3. Lyle Denniston, U.S. Appeals Major Insider Trading Case, SCOTUSBLOG (July 30, 2015), http://www.scotusblog.com/2015/07/u-s-appeals-major-insider-trading-case/. 4. Peter J. Henning, Court Strikes on Insider Trading, and Congress Lobs Back, N.Y. TIMES: DEALBOOK (Mar. 16, 2015), http://www.nytimes.com/2015/03/17/business/dealbook/ court-strikes-on-insider-trading-and-congress-lobs-back.html?_r=0. 5. United States v. Salman, 792 F.3d 1087, 1093 (9th Cir. 2015), cert. granted, 136 S. Ct. 899. 6. Dirks v. SEC, 463 U.S. 646, 662–63 (1983). 7. 773 F.3d 438, 452 (2d Cir. 2014), cert denied, 136 S. Ct. 242 (2015). 8. 792 F.3d at 1093–94. 9. Petition for Writ of Certiorari at *i, Salman v. United States, No. 15-628, 2015 WL 7180648 (Sup. Ct. Nov. 10, 2015). 10. Nate Raymond, US Top Court Leans Toward Making Insider Trading Prosecutions Easier, REUTERS (Oct. 5, 2016, 3:32 PM), http://www.reuters.com/article/us-usa-court-insidertrad ing-idUSKCN12510B. FALL 2016] No More Quid Pro Quo 177 trading. Because insider trading prohibitions currently rest on a vaguely-worded, catch-all anti-fraud prohibition, insider trading law has been shaped almost exclusively through the courts.11 The per- sonal benefit requirement arose out of the Supreme Court’s belief that an insider must have breached a fiduciary duty in order to have committed insider trading. Nevertheless, subsequent decisions eroded the strict reliance on this framework,12 but still tried to op- erate within the confines of Supreme Court jurisprudence requiring breach of a fiduciary duty. Because any judicial reform would have to adhere to this fiduciary duty framework (or overrule thirty-year-old precedent), this Note argues that the best vehicle for reforming insider trading law is a statutory approach. A more pre- cisely worded statute would help clarify many of the contours of the insider trading prohibition that have created controversy and confusion. Part I outlines the moral and economic underpinnings for in- sider trading law and examines the development of insider trading law through precedent. Part II discusses the division between the courts in Newman and Salman, drawing three key observations that demonstrate the need for a new approach to insider trading law. Part III advocates for a legislative response, critiques two different legislative proposals to codify insider trading, and offers an alterna- tive statutory proposal that may serve as a starting point for a discussion of adopting legislation. PART I: HISTORY OF INSIDER TRADING LAW The development of insider trading law over time represents a tension between the desire for both broad and narrow liability, flex- ibility and predictability, and fairness and efficiency. The current scope of insider trading law has broadly expanded from the strict fiduciary duty requirements articulated in early cases, but this ex- pansion comes at the expense of clarity in the law. 11. See Jorge Pesok, Insider Trading: No Longer Reserved for Insiders, 14 FLA. ST. U. BUS. REV. 109, 110 (2015). 12. See Donna M. Nagy, Insider Trading and the Gradual Demise of Fiduciary Principles, 94 IOWA L. REV. 1315, 1320 (2009); Stephen M. Bainbridge, Regulating insider trading in the post- fiduciary duty era: equal access or property rights?, in RESEARCH HANDBOOK ON INSIDER TRADING 80 (Stephen M. Bainbridge & William D. Warren eds., 2013); Sung Hui Kim, Insider Trading as Private Corruption, 61 UCLA L. REV. 928, 940–41 (2014). 178 University of Michigan Journal of Law Reform [VOL. 50:1 A. Insider Trading Law Within the Broader Securities Regime Securities regulation, broadly speaking, is primarily aimed at pro- tecting investors by reducing informational disadvantages investors suffer at the expense of corporate insiders and other market profes- sionals.13 These laws seek to protect investors through two chief means—promoting the disclosure of information,14 which provides investors with similar access to information as insiders, and deter- ring fraud,15 so that investors may not be taken advantage of by other market participants.
Load more

Recommended publications
  • SEC Complaint: CR Intrinsic Investors LLC, Mathew Martoma, and Dr
    AIRERO 12 CV 84 New York Regional Office 3 World Financial Center, Suite 400 New York, NY 10281-1022 (212) 336-0181 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK SECURITIES AND EXCHANGE COMMISSION, Plaintiff, -against- COMPLAINT CR INTRINSIC INVESTORS, LLC, MATHEW MARTOMA, ECFCASE and DR. SIDNEY GILMAN, Defendants. Plaintiff Securities and Exchange Commission ("Commission"), for its Complaint against defendants CR Intrinsic Investors, LLC ("CR Intrinsic"), Mathew Martoma ("Martoma"), and Dr. Sidney Gilman ("Gilman"), alleges as follows: SUMMARY 1. This is an insider trading case where affiliated investment advisers and their hedge funds made over $276 million in illegal profits or avoided losses in July 2008 by trading ahead of a negative public announcement involving the clinical trial results for an Alzheimer's drug being jointly developed by Elan Corporation, plc ("Elan") and Wyeth. 2. Martoma, then a portfolio manager at CR Intrinsic, an unregistered investment adviser, perpetrated the scheme with Gilman, a professor of neurology at the University of Michigan Medical School. Gilman served as the chairman of the Safety Monitoring Committee (the "SMC") overseeing the clinical trial, and was selected by Elan and Wyeth to present the final clinical trial results at a July 29, 2008 medical conference, which was to coincide with the after-market hours public announcement of the trial results by the two companies (the "July 29 Announcement"). 3. Martoma met Gilman through paid consultations that took place between 2006 and 2008, and were arranged by a New York-based expert network firm. During these consultations, Gilman provided Martoma with material nonpublic information about the ongoing clinical trial.
    [Show full text]
  • Is Hedge-Fund Titan Steve Cohen Going Down? | Vanity Fair
    HOME business June 2013 The Hunt for Steve Cohen With arrest after arrest in a massive, seven-year insider-trading investigation, U.S. Attorney Preet Bharara is getting closer to the biggest fish of them all: Steve Cohen, founder of SAC Capital, the $14 billion hedge fund, who some regard as the most successful stock picker of his time. C.E.O.’s have fallen, lives and companies have been upturned, but Cohen has thus far escaped. Bryan Burrough and Bethany McLean go deep inside Bharara’s probe—and SAC’s org chart—to reveal just how much blood is in Wall Street’s waters. By Bryan Burrough AND Bethany McLean Illustration by André Carrilho READ What Financial Titans Purchased on the Brink of Ruin THAR SHE BLOWS Steve Cohen has become a focal point of a seven-year probe into insider trading, led by U.S. Attorney Preet Bharara. So far, 71 people have been convicted or admitted guilt. Download this image as a desktop wallpaper. wenty-five years ago Wall Street, and much of America, was transfixed by a sweeping set of insider-trading investigations centered on the greatest financier of the age, junk-bond king Michael Milken, of Drexel Burnham Lambert. Day T after day, week after week, month after month, stories of U.S. Attorney Rudolph Giuliani’s relentless investigation dribbled out to the press. One by one, Giuliani picked off Milken’s minions, confronting them at their homes, handcuffing them at their offices, pulling them before secret grand juries, indicting a few, pressing for evidence that Milken had broken the law.
    [Show full text]
  • MATHEW MARTOMA, Defendant. No. 12
    Case 1:12-cr-00973-PGG Document 271 Filed 02/27/14 Page 1 of 45 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK UNITED STATES OF AMERICA, No. 12-cr-00973 (PGG) -against- ECF Case MATHEW MARTOMA, ORAL ARGUMENT REQUESTED Defendant. DEFENDANT MATHEW MARTOMA’S MEMORANDUM OF LAW IN SUPPORT OF HIS RENEWED MOTION FOR A JUDGMENT OF ACQUITTAL OR, ALTERNATIVELY, FOR A NEW TRIAL GOODWIN PROCTER LLP Richard M. Strassberg (RS5141) John O. Farley (JF4402) Daniel Roeser (DR2380) The New York Times Building 620 Eighth Avenue New York, New York 10018 (212) 813-8800 Roberto M. Braceras (RB2470) 53 State Street Boston, Massachusetts 02109 (617) 570-1000 Attorneys for Defendant Mathew Martoma February 27, 2014 Case 1:12-cr-00973-PGG Document 271 Filed 02/27/14 Page 2 of 45 TABLE OF CONTENTS Page PRELIMINARY STATEMENT .................................................................................................... 1 BACKGROUND ............................................................................................................................ 3 ARGUMENT .................................................................................................................................. 4 I. THE COURT SHOULD ENTER A JUDGMENT OF ACQUITTAL ON ALL COUNTS PURSUANT TO FEDERAL RULE OF CRIMINAL PROCEDURE 29. ............................................................................................................... 4 A. This Court Should Enter A Judgment Of Acquittal On The Substantive Counts Of Insider Trading. ....................................................................................
    [Show full text]
  • Supreme Court of the United States
    No. 18-972 IN THE Supreme Court of the United States MATHEW MARTOMA, Petitioner, v. UNITED STATES OF AMERICA, Respondent. ON PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT BRIEF FOR LAW PROFESSORS AS AMICI CURIAE IN SUPPORT OF PETITIONER ELIZABETH L. MITCHELL ALAN E. SCHOENFELD DANIEL WINIK Counsel of Record ANURADHA SIVARAM WILMER CUTLER PICKERING WILMER CUTLER PICKERING HALE AND DORR LLP HALE AND DORR LLP 7 World Trade Center 1875 Pennsylvania Ave. NW 250 Greenwich Street Washington, DC 20006 New York, NY 10007 (212) 230-8800 [email protected] TABLE OF CONTENTS Page TABLE OF AUTHORITIES ........................................... ii INTEREST OF AMICI CURIAE................................... 1 SUMMARY OF ARGUMENT ......................................... 3 ARGUMENT ....................................................................... 4 I. THE DECISION BELOW CREATES BROAD AND UNPREDICTABLE CRIMINAL LIABILITY....................... 4 A. The Second Circuit Eliminated The Personal Benefit Element Prescribed By This Court ........................................................ 4 B. The Decision Below Converts Dirks’s Objective Standard Into A Subjective One ........................................................................ 10 II. THE DECISION BELOW COMPOUNDS EXISTING PROBLEMS WITH INSIDER- TRADING LAW ............................................................. 11 A. The Decision Below Worsens The Due Process Problems Of Insider-Trading Law .......................................................................
    [Show full text]
  • Kaplan V. S.A.C. Capital Advisors, L.P. 12-CV-09350-Joint Consolidated
    Case 1:12-cv-09350-VM-KNF Document 127 Filed 03/31/14 Page 1 of 185 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK - - - - - - - - - - -- - - - - - - - - - - - - - - - - - - - - - - - - - - - - x : DAVID E. KAPLAN, MICHAEL S. ALLEN, CHI-PIN HSU, GARY W. MUENSTERMAN, FRED M. ROSS, MICHAEL CAHILL, JOHN P. CONNOLLY, JOHN M. GOULD, CAROLINE P. GOULD, GREG : KAPPES, DEEANN LEMMERLING, LUC : No. 12 Civ. 9350 (VM) (KNF) LEMMERLING, GARRY LEONARD, DAVID : (All Actions) LINDSAY, RICHARD LLOYD, GLEN LOCHMUELLER, STEPHEN W. MAMBER, JAMES C. MCGOWAN, CHRIS MITCHEM, BRIDGET : JURY TRIAL DEMANDED MONRAD, CHRISTIAN MONRAD, BENJAMIN MONRAD, JOSEPH F. MORGAN, JIM MOSER, STEVEN R. OLSON, LAWSON PHILLIPS, : ECF CASE SEYMOND PON, PAT A. SANYE, RONALD J. SANYE, PATRICIA TRACY, LINH TU, RAJ VADDI, JOHN WOLFF, and RHONDA WOLFF, Individually and on Behalf of All Others Similarly Situated, Plaintiffs, - against - S.A.C. CAPITAL ADVISORS, L.P., S.A.C. CAPITAL ADVISORS, INC., CR INTRINSIC INVESTORS, LLC, CR INTRINSIC INVESTMENTS, LLC, S.A.C. CAPITAL ADVISORS, LLC, S.A.C. CAPITAL ASSOCIATES, LLC, S.A.C. INTERNATIONAL EQUITIES, LLC, S.A.C. SELECT FUND, LLC, STEVEN A. COHEN, MATHEW MARTOMA, and SIDNEY GILMAN, Defendants. - - - - - - - - - - -- - - - - - - - - - - - - - - - - - - - - - - - - - - - - x (caption continued . ) JOINT CONSOLIDATED AMENDED CLASS ACTION COMPLAINT Case 1:12-cv-09350-VM-KNF Document 127 Filed 03/31/14 Page 2 of 185 (. caption continued) - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x : BIRMINGHAM RETIREMENT AND RELIEF : SYSTEM and KBC ASSET MANAGEMENT NV, : Individually and on Behalf of All Others Similarly : Situated, : No. 13 Civ. 2459 (VM) (KNF) Plaintiffs, : - against - : JURY TRIAL DEMANDED : S.A.C. CAPITAL ADVISORS, L.P., S.A.C. CAPITAL : ADVISORS, INC., CR INTRINSIC INVESTORS, : ECF CASE LLC, CR INTRINSIC INVESTMENTS, LLC, S.A.C.
    [Show full text]
  • The Applicability of Bioethics Concepts to Insider Trading Law
    Unexpected Commonalities: The Applicability of Bioethics Concepts to Insider Trading Law By SAMER B. KORKOR* Introduction ON NOVEMBER 20, 2012, the Federal Bureau of Investigation (“FBI”) arrested Mathew Martoma, a former student of bioethics and former CR Intrinsic Investors, LLC fund manager, on charges of in- sider trading.1 The Securities and Exchange Commission (“SEC”) and the Department of Justice (“DOJ”) alleged that Martoma violated in- sider trading laws by engaging in a scheme with neurologist Sidney Gilman.2 The charges asserted that Gilman provided confidential in- formation to Martoma about a clinical trial of a drug designed to treat Alzheimer’s disease. According to the government, this confidential information allowed Martoma’s firm to trade stocks in pharmaceutical companies ahead of a public announcement about the results of the trial that had a negative impact on the value of the shares.3 On Janu- * Samer B. Korkor is an attorney in Washington D.C. The theories and opinions in this article are the author’s alone. Thank you to my wife Christine Daya Korkor, brother Bassel Charles Korkor, and the University of San Francisco Law Review for their comments on drafts. 1. Bridget Murphy, Insider Trading Suspect Was Model Ethics Student, ASSOCIATED PRESS (Nov. 30, 2012), http://bigstory.ap.org/article/insider-trading-suspect-was-model-ethics- student. 2. See Complaint ¶¶ 1–4, SEC v. CR Intrinsic Investors, LLC, No. 12-CV-8466 (VM) (S.D.N.Y. 2012) [hereinafter SEC Complaint]; Complaint ¶¶ 1–3, United States v. Martoma, No. 12-MAG-2985 (DF) (S.D.N.Y. Nov.
    [Show full text]
  • The State of Insider Trading: Life After Newman and Salman
    The State of Insider Trading: Life after Newman and Salman Cynthia Bookhart Adams Managing Director, Legal & Compliance, Jefferies & Company Jonathan E. Green Partner, Arnold & Porter Kaye Scholer LLP Daniel M. Hawke Partner, Arnold & Porter Kaye Scholer LLP Andrew Bauer Partner, Arnold & Porter Kaye Scholer LLP apks.com June 15, 2017 Arnold & Porter Kaye Scholer LLP All Rights Reserved. Insider Trading: The Legal Landscape 2 Insider Trading Background: Section 10(b) and Rule 10b-5 . Section 10(b) of the Exchange Act provides, in pertinent part: It shall be unlawful for any person, directly or indirectly, by the use of any means or instrumentality of interstate commerce or of the mails, or of any facility of any national securities exchange . (b) To use or employ, in connection with the purchase or sale of any security registered on a national securities exchange or any security not so registered, or any securities-based swap agreement, any manipulative or deceptive device or contrivance in contravention of such rules and regulations as the Commission may prescribe as necessary or appropriate in the public interest or for the protection of investors. 15 U.S.C. § 78j(b) (2012) 3 Insider Trading Background: Section 10(b) and Rule 10b-5 . Rule 10b-5 provides, in pertinent part: It shall be unlawful for any person, directly or indirectly, by the use of any means or instrumentality of interstate commerce, or of the mails or of any facility of any national securities exchange, a) To employ any device, scheme, or artifice to defraud, b) To make any untrue statement of a material fact or to omit to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading, or c) To engage in any act, practice, or course of business which operates or would operate as a fraud or deceit upon any person, in connection with the purchase or sale of any security.
    [Show full text]
  • White Collar Crime and Securities Enforcement: 2012 in Review
    White Collar Crime Report™ Reproduced with permission from White Collar Crime Report, 08 WCR 57, 01/25/2013. Copyright ஽ 2013 by The Bureau of National Affairs, Inc. (800-372-1033) http://www.bna.com SECURITIES FRAUD White Collar Crime and Securities Enforcement: 2012 in Review ing out of the LCD panel investigation, prevailed in a string of insider trading cases, and secured large civil settlements and other resolutions with banks related to the financial crisis. Yet defendants won their own share of Securities and Exchange Commission actions arising out of the financial crisis, a major Foreign Corrupt Prac- tices Act trial, and the John Edwards public corruption trial. This article highlights some of 2012’s key white col- lar and securities enforcement actions and identifies cases to watch in 2013. Foreign Corrupt Practices Act BY BROOK DOOLEY AND ERIC H. MACMICHAEL rosecution and defense counsel could each find Coming on the heels of the Department of Justice’s something to cheer in 2012, as both sides won im- loss in the Lindsey Manufacturing case, 2012 was an- P portant white collar and securities cases. The gov- other difficult year in the courtroom for prosecutors ernment won a significant criminal antitrust trial aris- seeking convictions under the Foreign Corrupt Prac- tices Act. The most notable failure was the ‘‘Africa Sting’’ case, which arose out of an undercover arms in- Brook Dooley is a partner at the San Fran- dustry investigation.1 As part of the investigation, gov- cisco litigation firm Keker & Van Nest LLP. ernment officials attended an annual trade show in Las He handles white collar criminal matters and Vegas and posed as representatives of the Gabon gov- complex civil litigation involving securities ernment.
    [Show full text]
  • Martoma: Prior Bad Acts and Hobson's Choice for Defendants
    G THE B IN EN V C R H E S A N 8 8 D 8 B 1 AR SINCE WWW. NYLJ.COM VOLUME 251—NO. 23 TUESDAY, FEBRUARY 4, 2014 WHITE-COLLAR CRIME Expert Analysis Martoma: Prior Bad Acts And Hobson’s Choice for Defendants criminal defendant’s decision and insider trading. Six other employees to take the stand or remain have pleaded guilty.1 silent in the face of the gov- Former SAC portfolio manager Mathew ernment’s accusations is one of Martoma is the second employee, after the most pivotal choices to be Steinberg, to contest the government’s Amade during a criminal trial. Frequently, insider trading charges. Martoma is defendants opt to stay silent, fearing charged with illegally trading on confiden- By And the prosecution’s inevitable attack on Robert J. Richard F. tial information obtained from a doctor their credibility and character if they Anello Albert involved in a 2008 pharmaceutical trial take the stand to defend themselves. for an Alzheimer’s-related drug jointly Many believe, however, that declining insider trading prosecution currently developed by Elan Corp. Plc and Wyeth. to take the stand in white-collar cases is on trial in the Southern District of New The indictment alleges that Martoma risky, particularly in insider trading pros- York reveals how the government can received inside information about the ecutions—just ask Michael Steinberg, seek to inject such “prior bad acts” drug companies’ Alzheimer’s study from Raj Rajaratnam, or Rajat Gupta, a few evidence into a case to raise questions Dr. Sidney Gilman, an Alzheimer’s dis- of those convicted in recent high-profile about the defendant’s credibility regard- ease expert and professor who worked insider trading cases after deciding not less of whether or not the defendant as a paid consultant to Elan.
    [Show full text]
  • Spring 2018, Volume 12 Issue 1 12 Volume Spring 2018,
    Spring 2018 International Journal of the Academic Business World CONTENTS Bad Actors in the Channels of Distribution: Conceptual Clarity, Demarcation & Antecedents of Abuse Brent L. Baker and Chase J. Edwards ........................................................................1 Peering Through the Portal: An Investigation into Threshold Concepts in Web Development Michael Mick and Susan E. Conners ..........................................................................9 Investment Psychological Biases in The Unied States and Nigeria Alan Wong and Chuke Nwude .................................................................................15 It Security Threats and Challenges for Small Firms: Managers’ Perceptions International Journal the Academic of Business World Mahmoud Watad, Sal Washah, and Cesar Perez ....................................................23 A Review of Research on Child Safety in Motor Vehicles: Ollie Otter Seat Belt and Booster Seat Education Program in its 10th Year in Tennessee Selin Anitsal, Ismet Anitsal, and M. Meral Anitsal .................................................31 Chronic Conditions: A Motivator for Reexamining the Effectiveness of Promotions and Communications of Organizational Wellness Programs Jamye Long, Cooper Johnson, Sam Faught, and Janye Wilson .................................39 Internal Audit, Fraud and Risk Management at Wells Fargo Uma V. Sridharan and Linda U. Hadley ..................................................... 49 Insider Trading After the Salman Ruling Larry Bumgardner
    [Show full text]
  • SAC Capital Advisors to Pay $1.2 Billion Fine in Insider Trading Case
    Case 1:12-cr-00121-RJS Document 319 Filed 11/12/13 Page 1 of 195 UNITED STATES DISTRICT COURT DOCUMENT SOUTHERN DISTRICT OF NEW YORK ELECTRONICALLY FILED DOC#: UNITED STATES OF AMERICA LDATE FILED: !f~ \1:-'"'1; "­ -v- No. 12 Cr. 121 (RJS) MICHAEL STEINBERG, ORDER Defendant. RICHARD 1. SULLIVAN, District Judge: The Court is in receipt of the attached letter, motion, and supporting documents submitted by Defendant. Defendant's motion requests (1) a three month adjournment of his trial to allow the recent publicity surrounding SAC's guilty plea to dissipate; and (2) "individualized, searching questioning of all potential jurors who have been exposed to" recent SAC pUblicity. In addition, Defendant requests permission to file his motion under seal. For the reasons set forth below, the Court denies the sealing request, denies the request for an adjournment, and grants the request for individualized questioning of all jurors who have been exposed to SAC pUblicity. There is a general presumption of open access to judicial records, especially where the records are relevant to a Court's determination of a litigant's substantive rights. United States v. Amodeo, 71 F.3d 1044, 1049-50 (2d Cir. 1995). The Court sees no factors to counterbalance that general presumption in this case. Defendant points to the risk of pretrial publicity, but there is no reason why this motion presents any greater risk for pretrial pUblicity than any other motion. Accordingly, the request to seal the motion is denied. The Court acknowledges that there has been a great deal of pretrial publicity relating to this case, especially within the last several weeks.
    [Show full text]
  • 18 16 India Day Parade in New York City Brings a Riot of Tricolor
    www.theindianpanorama.com VOL 11 ISSUE 34 ● NEW YORK ● AUGUST 25 - AUGUST 31, 2017 ● ENQUIRIES: 646-247-9458 ● PRICE 40 CENTS The talaq Trump’s On India's 70th Independence Jacqueline: I’ve a verdict fallout Afghan Shift Anniversary, let us be genuine interest in 8 9 16 reminded: Rivers are India's Lifelines 18 learning Urdu Nandan Nilekani back at Infosys as Chairman India Day Parade in New York City BENGALURU (TIP): Nandan brings a riot of Tricolor Nilekani, the 62-year- old co-founder of 25 floats, dozens of marching bands and dancing groups; thousands cheering with tricolor in hands India's second-largest software services exporter, returned to the Infosys board after an 8-year hiatus on Thursday, August 24, as the firm's Former CEO returns to Infosys board after 8-year chairman, a move gap; aims to restore calm that investors expect following Sikka's bitter exit contd on page 32 Right to privacy verdict: Top lawyers unsure about Aadhaar's future NEW DELHI (TIP): The landmark verdict of the Supreme Court ruling on right to privacy as a fundamental right was on August 24, 2017 welcomed by jurists and senior advocates who termed “You cannot make a blanket and categorical statement it as "progressive" and protective of "the that Aaadhaar will be banned New York City Mayor Bill de Blasio, waving India's tricolor, marched in the parade Photos: Jay Mandal/On Assignment or is unconstitutional," says basic right". They, Soli Sarbjee. File Photo / however, said the NEW YORK (TIP): Thousands of people The 37th India Day Parade organized by police contingents and cultural Shanker Chakravarty contd on page 32 from the Indian diaspora converged in the the Federation of Indian Associations - New performances by young Indian-American heart of New York, on August 20, to York, New Jersey,Connecticut - ran through children.
    [Show full text]