Securities Exchange Act, Rule 10b-5, Securities Fraud

Takeaways for In-House Counsel from DOJ’s First Insider Trading Trial Involving a Rule 10b5-1 Plan

Morrison & Foerster LLP on 6/28/2024

On June 21, 2024, a jury in California federal court found a former chief executive officer of a publicly traded healthcare company guilty of insider trading in United States v. Peizer, the first criminal insider-trading case...more

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

Holland & Knight LLP on 6/11/2024

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

SEC Secures Jury Verdict in Shadow Insider Trading Trial

Kramer Levin Naftalis & Frankel LLP on 4/19/2024

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

SEC v. Panuwat – Northern District Of California Jury Endorses SEC’s “Shadow Trading” Theory

A&O Shearman on 4/16/2024

On April 5, 2024, a jury in the Northern District of California found that Matthew Panuwat had misappropriated his employer’s confidential information and committed insider trading. The closely followed case represented the...more

Nutter Securities Enforcement Update: January 1, 2024

Nutter McClennen & Fish LLP on 1/17/2024

The Nutter Securities Enforcement Update is a periodic summary of noteworthy recent securities enforcement activity, settlements, decisions, and charges....more

Split Tenth Circuit Affirms Dismissal Of Exchange Act Claims Against Aerostructures Manufacturing Company And Its Executives,...

A&O Shearman on 9/12/2023

On August 21, 2023, the United States Court of Appeals for the Tenth Circuit affirmed dismissal of a consolidated putative class action alleging violations of Section 10(b) of the Securities Exchange Act of 1934 (the...more

New York District Court Denies In Part And Grants In Part Motion To Dismiss Class Action Against Agriculture Company

A&O Shearman on 8/8/2023

On July 21, 2023, Judge Lewis J. Liman of the United States District Court for the Southern District of New York granted in part and denied in part a motion to dismiss a putative securities class action alleging that an...more

District Of Minnesota Dismisses Exchange Act Claims Against Mattress Company With Prejudice, Finding Investors Failed To...

A&O Shearman on 8/7/2023

On July 10, 2023, Chief Judge Patrick J. Schiltz of the United States District Court for the District of Minnesota granted a motion to dismiss a putative securities fraud class action against a mattress and bedding company...more

SEC Charges Adviser and its Principal in Illegal Short Selling Scheme

Seward & Kissel LLP on 6/19/2023

Who may be interested: Investment advisers, broker-dealers. Quick Take: The SEC recently filed a lawsuit charging an investment adviser and its managing partner (collectively, the Adviser) with allegedly engaging in a...more

The Second Circuit's Blaszczak Decision Fails to Resolve One Issue, Raises New Ones

WilmerHale on 1/27/2023

On December 27, 2022—nearly 18 months after hearing oral arguments—the Second Circuit issued its new opinion in United States v. Blaszczak, an important insider trading case involving the misappropriation of confidential...more

SEC amends Rule 10b5-1 and revamps affirmative defense to insider trading charges

Eversheds Sutherland (US) LLP on 1/5/2023

The Securities and Exchange Commission (SEC) has unanimously adopted amendments to Rule 10b5-1 (the Rule), which prohibits the purchase or sale of securities on the basis of material nonpublic information (MNPI) in violation...more

Assessing Impact of Second Circuit's Rio Tinto Decision on Scheme Liability

Holland & Knight LLP on 8/25/2022

When it comes to the federal securities laws, clear answers can occasionally be hard to find. There may be no better example than the question around the overlap of the "misstatement liability" and "scheme liability"...more

What Constitutes a Misleading Statement in a Company’s Response to a Data Breach?

Pietragallo Gordon Alfano Bosick & Raspanti,... on 6/28/2022

Takeaway: To ensure investor safety and emphasize a commitment to user privacy, corporate executives and similarly-situated high ranking officers must not provide any statements or omissions that affirmatively create a...more

First Circuit Affirms Dismissal Of Putative Securities Class Action Against Bank For Alleged Failure To Disclose Deteriorating...

A&O Shearman on 6/3/2022

On May 20, 2022, the United States Court of Appeals for the First Circuit affirmed the district court’s dismissal of claims under Section 10(b) of the Securities Exchange Act (the “Exchange Act”) and Rule 10b-5 thereunder...more

Second Circuit Limits Criminal Restitution Orders Under the Mandatory Victims Restitution Act: Expenses Associated With SEC...

Kramer Levin Naftalis & Frankel LLP on 3/30/2022

On Feb. 25, 2022, the U.S. Court of Appeals for the Second Circuit held in United States v. Afriyie that restitution orders under the Mandatory Victims Restitution Act (MVRA) do not allow victims to recover attorneys’ fees...more

SEC’s “shadow trading” case survives motion to dismiss

Cooley LLP on 1/20/2022

In August last year, the SEC announced that it had filed a complaint in the U.S. District Court charging Matthew Panuwat, a former employee of Medivation Inc., an oncology-focused biopharma, with insider trading in advance of...more

In Echo of Expert Network Cases, SEC Reaches Securities Fraud Settlement with Alternative Data Provider

Kramer Levin Naftalis & Frankel LLP on 9/23/2021

On Sept. 14, 2021, the Securities and Exchange Commission (SEC) entered a cease-and-desist order against App Annie Inc. and its co-founder and former CEO, Bertrand Schmitt, after agreeing to settle securities fraud claims....more

District Court Takes Judicial Notice of SEC Order in Denying Motion to Dismiss Shareholder Claims

Proskauer - Corporate Defense and Disputes on 6/16/2021

In our previous post, Under Armour Inc. Pulls Sales Forward, SEC and Stockholders Push Back, we discussed Under Armour Inc.’s recent settlement with the SEC, under which Under Armour agreed to pay $9 million for alleged...more

Rule 10b5-1: Fix the Cracks But Save the Baby

Seyfarth Shaw LLP on 6/14/2021

On June 7, 2021, U.S. Securities and Exchange Commission Chair Gary Gensler announced at the CFO Network Summit that he has asked his staff to make recommendations for the Commission’s consideration on how it might “freshen...more

Failure to Cruise Past the Pleading Requirements in the Norwegian Cruise Lines Securities Class Action

Proskauer - Corporate Defense and Disputes on 5/4/2021

On April 10, 2021, the United States District Court for the Southern District of Florida dismissed a securities class action complaint against Norwegian Cruise Lines (“NCL”) relating to the company’s disclosures made as the...more

Southern District Of New York Dismisses Securities Fraud Complaint Against An Insurance Company, Finding That Confidential Witness...

A&O Shearman on 3/11/2020

On March 2, 2020, Judge Paul A. Engelmayer of the United States District Court for the Southern District of New York dismissed a putative securities fraud class action asserting violations of Sections 10(b) and 20(a) of the...more

Rule 10b5-1 Plans At 20: Enforcement Trends & Best Practices

Morrison & Foerster LLP on 2/26/2020

2020 marks the 20th anniversary of the Rule 10b5-1 plan. During its two-decade history, it has provided an affirmative defense against allegations of insider trading by corporate insiders that trade their company’s stock,...more

Middle District Of Florida Dismisses Securities Fraud Action Against Foodservice Equipment Company For Failure To Plead Scienter

A&O Shearman on 2/19/2020

On February 6, 2020, Judge James S. Moody, Jr. of the United States District Court for the Middle District of Florida dismissed a putative class action asserting violations of Section 10(b) of the Securities Exchange Act of...more

Bharara Task Force Overlooks California Insider Trading Statute

Allen Matkins on 1/29/2020

I have long advocated for a federal statutory definition of insider trading because I believe that the current approach has been for the courts to convict first and then explicate the theory supporting the conviction in a...more

New York District Court Dismisses Securities Class Action Against Tax Services Provider Alleging Fraudulent Concealment Of CEO's...

A&O Shearman on 1/28/2020

On January 17, 2017, Judge Nicholas G. Garaufis of the United States District Court for the Eastern District of New York dismissed a putative class action asserting claims under Sections 10(b), 14(a), and 20(a) of the...more

Securities Exchange Act › Rule 10b-5 › Securities Fraud

"My best business intelligence, in one easy email…"