News & Analysis as of

Material Nonpublic Information Insider Trading

Fenwick & West LLP

Form 4 Code J Transactions Under Scrutiny

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The Harvard Business Law Review recently published an article entitled “Insider Trading by Other Means” by an influential research group, which asserts that using the “J” (other) code in a Form 4 is highly correlated with...more

White & Case LLP

DOJ’s Novel Application of Insider Trading to 10b5-1 Plans Leads to Conviction

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In April, we issued an alert discussing the U.S. Securities and Exchange Commission ("SEC") and Department of Justice’s ("DOJ") expansion of insider trading to 10b5-1 plans. On June 21, 2024, a federal jury in California...more

BCLP

CFTC’s Consent Order with Trafigura Trading: When Inaction Becomes Action

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On June 17, 2024, the CFTC filed a consent order against Trafigura Trading LLC, requiring the company to pay a $55 million civil monetary penalty and implement remedial measures. The CFTC’s order details three violations of...more

BCLP

Conviction of Insider in Connection with 10B5-1 Trading Plan

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As discussed in our March 3, 2023 post, the DOJ and SEC brought an insider trading case against the founder and former CEO and Executive Chairman of Ontrak, Inc. based upon the former executive failing the “clean hands”...more

Dorsey & Whitney LLP

DOJ Secures Conviction in First Insider Trading Case Based Exclusively on Rule 10b5-1 Trading Plans

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On June 21, 2024, a Los Angeles federal jury convicted former Ontrak, Inc. CEO and Chairman of the Board of Directors Terren S. Peizer of insider trading in a first-of-its-kind prosecution based exclusively on the use of Rule...more

Cooley LLP

Jury convicts former executive for insider trading and fraudulent use of Rule 10b5-1 plan

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Back in March 2023, the DOJ unsealed an indictment against Terren Peizer, formerly the executive chair of Ontrak, Inc., representing the first time, according to the press release, that the DOJ brought “criminal insider...more

BCLP

Post-Panuwat: Have You Reviewed and Updated Your Insider Trading and Other Corporate Policies?

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As discussed in our September 1, 2021 post, the SEC brought its first “shadow insider trading” case against Matthew Panuwat, a company employee who purchased options in a competitor’s shares shortly after learning his...more

Holland & Knight LLP

Shady Days: SEC Secures Another Insider Trading Stat on Shadow Trading Theory

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The U.S. District Court for the Northern District of California on May 30, 2024, approved a settled final judgment against technology company Arista Networks' former chairman and CEO, Andreas "Andy" Bechtolsheim based on...more

Dorsey & Whitney LLP

RIA Regulatory Review - June 2024

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This RIA Regulatory Review highlights certain key regulatory developments affecting investment advisers....more

BCLP

Don’t Pull the Trigger on That Stock Trade Just Yet! Questions Counsel Should Ask Insiders Before They Trade; Topics to Cover When...

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One of the routine duties of counsel for a public company is advising officers and directors on their trades in company stock and their SEC responsibilities when they leave. Because those discussions are routine, it may be...more

WilmerHale

Looking Forward After the SEC’s Victory in “Shadow Trading” Case

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This month the SEC secured a jury trial victory in its much-discussed “shadow trading” case in SEC v. Panuwat. As we have described in a prior alert, the term “shadow trading” has been used to refer to trading in the...more

Thomas Fox - Compliance Evangelist

Panuwat-Shadow Insider Trading and Compliance

Karen Woody is one of the country’s top legal experts on the intricacies of insider trading laws. I recently had the chance to visit with her about a significant case which pushed the boundaries of the case law on this topic....more

Cadwalader, Wickersham & Taft LLP

Shadow Trading Expands Potential Insider Trading Liability in S.E.C. v. Panuwat

Insider trading generally refers to the trading of a company’s security based upon material non-public information (“MNPI”) about that company. But a recent litigation victory by the U.S. Securities and Exchange Commission...more

Jones Day

SEC Prevails in Novel "Shadow Trading" Insider Trading Trial

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The Securities and Exchange Commission ("SEC") won at trial in its first "shadow trading" case, holding a corporate official liable for insider trading for using nonpublic information about his company's acquisition to trade...more

Kramer Levin Naftalis & Frankel LLP

SEC Secures Jury Verdict in Shadow Insider Trading Trial

On April 5, 2024, a federal jury in San Francisco returned a verdict in favor of the Securities and Exchange Commission (SEC) in Securities and Exchange Commission v. Panuwat. The jury found that a corporate executive had...more

Morrison & Foerster LLP

Takeaways for In-House Counsel from the SEC’s “Shadow Insider Trading” Trial

On April 5, 2024, a jury in California federal court found a former corporate executive liable for insider trading in SEC v. Panuwat, a novel enforcement action involving a theory known as “shadow trading.” In Panuwat, the...more

Hahn Loeser & Parks LLP

New Insider Trading Precedent: Time To Update Insider Trading Policy

On April 5, 2024, the Securities and Exchange Commission (the “SEC”) obtained a verdict after an eight-day civil jury trial in SEC v. Matthew Panuwat (“SEC v. Panuwat”), in which the SEC alleged shadow insider trading, in...more

Tannenbaum Helpern Syracuse & Hirschtritt LLP

The SEC Wins First Insider Trading Case Based on So-Called “Shadow Trading” Theory

On April 5, 2024, a federal jury in SEC v. Panuwat (N.D. Cal.) agreed with the SEC that a corporate official engaged in insider trading when he purchased securities of a company based on material nonpublic information...more

Cooley LLP

The jury finds shadow trading is a thing

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The trial took eight days. The jury took two hours. On Friday, in the case of SEC v. Panuwat, the jury in a federal district court in California determined that Matthew Panuwat was civilly liable for insider trading under the...more

BakerHostetler

SEC Eyes Work-From-Home Pitfalls in Crackdown on Insider Trading and Off-Channel Communications

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The new flexible work environment created in the post-pandemic years poses unique challenges for companies and individuals who work outside a traditional office. The SEC knows this and is actively enforcing the securities...more

Nutter McClennen & Fish LLP

Nutter Securities Enforcement Update: March 1, 2024

The Nutter Securities Enforcement Update is a periodic update of noteworthy recent securities enforcement activity, settlements, decisions, and charges. We provide brief summaries that highlight recent enforcement action...more

Freeman Law

Insider Trading Law | An Evolving Landscape

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Throughout the history of the U.S. stock market, individuals have used insider access to information to gain an unfair advantage over other investors. The use of material non-public information (“MNPI”) in financial trading...more

Miller Canfield

Redefining Insider Trading: The SEC's Groundbreaking Theory in the Panuwat Case

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In SEC v Panuwat, a federal jury in California will hear a novel insider trading theory that the court has allowed to proceed to trial. In Panuwat, the SEC says it is unlawful for an individual to purchase securities of a...more

BakerHostetler

Jury Finds Former NFT Marketplace Manager Guilty of 'Insider Trading' Wire Fraud Scheme and Money Laundering

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On May 3, 2023, a jury found Nathaniel Chastain, a former manager of OpenSea (a major NFT marketplace), guilty of wire fraud and money laundering in connection with his attempts to conceal his use of confidential business...more

Jones Day

Insider Trading Enforcement in 2022

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Each year, the Department of Justice ("DOJ"), the Securities and Exchange Commission ("SEC"), and in recent years, the Commodity Futures Trading Commission ("CFTC") dedicate substantial resources to investigating and...more

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