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Click here to find out moreThe Second Circuit's decision in U. S. v. Newman is, according to many, a dramatic change in the law of insider trading and illegal tipping. Under the decision, the government must plead not just that the tippee knew the information was being passed in violation of a duty, but also that there was a personal benefit in the nature of a quid pro quo. Others claim the decision is nothing more than the restoration of the Supreme Court's holding in Dirks. Nevertheless, the DOJ and the SEC have decried this standard as undermining effective insider trading enforcement. One district court decision in Manhattan in an SEC enforcement action appears to undercut the spirit if not the letter of the law, and a recent decision by the Ninth Circuit also seems to push back on Newman—all as the Manhattan U.S. Attorney and the Solicitor General consider a Supreme Court appeal. Join Tom Gorman as he explores the application of Newman in insider trading cases and options for the DOJ, SEC and defense in the future.
