Securities Law Commons^™

Why Now Is The Time To Statutorily Ban Insider Trading Under The Equality Of Access Theory, Bruce W. Klaw

William & Mary Business Law Review

This Article makes the case for a new U.S. statutory provision that defines and prohibits insider trading under an “equality of access” theory. It supports this claim, and contributes to the important public dialogue concerning this prevalent practice, by highlighting the moral and legal gaps in existing U.S. law that result from understanding the harms of trading on the basis of material nonpublic information solely with reference to fiduciary breach or misappropriation, as evidenced by the recent cases of United States v. Newman and United States v. Salman. It weaves legal analysis together with current literature in business ethics, moral …

The Fifteenth Annual Albert A. Destefano Lecture On Corporate, Securities, & Financial Law At The Fordham Corporate Law Center, Frederick H. Alexander, Chris Cernich, Mark Lebovitch, Norman M. Monhait, Andrew J. Pincus

Fordham Journal of Corporate & Financial Law

No abstract provided.

Disciplining Corporate Boards And Debtholders Through Targeted Proxy Access, Michelle M. Harner

Indiana Law Journal

Corporate directors committed to a failed business strategy or unduly influenced by the company’s debtholders need a dissenting voice—they need shareholder nominees on the board. This Article examines the biases, conflicts, and external factors that impact board decisions, particularly when a company faces financial distress. It challenges the conventional wisdom that debt disciplines management, and it sug-gests that, in certain circumstances, the company would benefit from having the shareholders’ perspective more actively represented on the board. To that end, the Article proposes a bylaw that would give shareholders the ability to nominate direc-tors upon the occurrence of predefined events. Such …

Family Ties: Salman And The Scope Of Insider Trading, Jill E. Fisch

All Faculty Scholarship

On October 5, 2016, the Supreme Court heard oral argument in Salman v. United States. Salman raises questions about the scope of insider trading liability for tippees under the personal benefit test previously articulated in Dirks v. SEC. Some critics have argued the Second Circuit’s decision last year in United States v. Newman demonstrates that the personal benefit test is unduly restrictive and should be reconsidered. Salman offers an opportunity for the Supreme Court to do so.

This essay argues that Salman does not require the Court to reexamine the parameters of insider trading liability. Instead, the Court can …

Shadow Banking And Regulation In China And Other Developing Countries, Steven L. Schwarcz

Faculty Scholarship

The rapid but largely unregulated growth in shadow banking in developing countries such as China can jeopardize financial stability. This article discusses that growth and argues that a regulatory balance is needed to help protect financial stability while preserving shadow banking as an important channel of alternative funding. The article also analyzes how that regulation could be designed.

Inclusive Crowdfunding, Andrew A. Schwartz

Utah Law Review

Retail crowdfunding under Title III of the JOBS Act has a fundamental advantage over accredited crowdfunding and intrastate crowdfunding: the value of inclusivity. What that is worth in a given instance may be difficult to calculate, but it is surely more than zero. This is one reason to expect that retail crowdfunding, once it commences, may prove more successful than many commentators anticipate.

Perspectives On Regulating Systemic Risk, Steven L. Schwarcz

Faculty Scholarship

This book chapter, which synthesizes several of the author’s articles, attempts to provide useful perspectives on regulating systemic risk. First, it argues that systemic shocks are inevitable. Accordingly, regulation should be designed not only to try to reduce those shocks but also to protect the financial system against their unavoidable impact. This could be done, the chapter explains, by applying chaos theory to help stabilize the financial system. The chapter then focuses on trying to prevent excessive corporate risk-taking, which is one of the leading triggers of systemic shocks and widely regarded to have been a principal cause of the …