Commentary on the O'Hagan Insider Trading Case
25 June 1997
avid Lipton, securities law professor, The Catholic University of America:
"The Supreme Court has finally placed its full weight behind the misappropriation theory in reversing an 8th Circuit Court of Appeals decision on insider trading."
"In doing such it may be argued that the Supreme Court has back-pedaled on a previously held position that denied responsibility of insiders to all securities market participants."
"However, the court's decision was necessary in order to preserve the vitality of the prohibitions against insider trading. While the distinction that the court drew is extraordinarily fine it will be difficult to discern its dictates in other fact patterns. Nonetheless, it will serve to uphold the integrity of the securities market and restore investor confidence in capital markets."
Lipton can be reached for further comment and interviews at (O) 202-319-5452 (H) 202-966-6037 / firstname.lastname@example.org.
He is former visiting attorney for the Securities and Exchange Commission-Division of Marketing Regulation; chair, National Arbitration Committee of the National Association of Securities Dealers; and chair, steering committee, D.C. Bar's section on corporation, finance and securities.
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Revised: 27 October 1997
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