History Says Newman Is Faithful To Dirks

Law360, New York ( August 14, 2015, 12:42 PM EDT) -- In United States v. Newman, 773 F.3d 438 (2nd Cir. 2014), the Second Circuit overturned the insider trading convictions of two hedge fund managers who received material nonpublic information from public companies via an extended tipping chain. The Newman court was required to interpret the U.S. Supreme Court's decision in Dirks v. U.S. Securities and Exchange Commission, 463 U.S. 646 (1983), to answer the question: What must tippees know about the disclosure of nonpublic information by the tipping corporate insider in order to sustain a conviction?...

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