In its first insider trading decision in nearly two decades, the US Supreme Court ruled unanimously to uphold an insider trading conviction of an individual (tippee) who traded while aware of material non-public information (MNPI) received from a friend (tipper) who did not receive a financial benefit for providing the tip. Salman v. United States, No. 15-628, 2016 WL 7078448 (U.S. Dec. 6, 2016). The ruling, written by Justice Samuel Alito, settles a split of authority between the US Court of Appeals for the Second and Ninth Circuits regarding whether a tipper receives a “personal benefit” for purposes of establishing insider trading liability by simply conveying MNPI to a family member or friend.
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