Case summary: Person DE was serving as the chief financial officer for a company REC. The company was a distributor of serving electricity in portions of North Dakota. Company REC was taking over company DGI that was distributing natural gas within North Dakota. DE went on a trip to fishing with his uncle EW. During the trip, DE told his uncle that he has been investing a lot of extra time in company REC as it was taking over the natural gas distributing company, DGI. P EW after returning from the trip purchased a stock of $20,000 in company REC. The value of stock rose by 72 percent that resulted in a profit of $14,400 at the time when EW sold his stock of REC.
To explain:The theories court will use to hold EW liable for insider trading.
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Chapter 28 Solutions
The Legal Environment of Business: Text and Cases
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Foundations of Business (MindTap Course List)MarketingISBN:9781337386920Author:William M. Pride, Robert J. Hughes, Jack R. KapoorPublisher:Cengage Learning