The U.S. Department of Justice has petitioned the U.S. Supreme Court to overturn its ruling in U.S. v. Newman et al. that raised the bar for prosecuting insider trading cases. Here, attorneys tell Law360 why the appeal is significant.
“The Newman decision raised the bar substantially for the prosecution of insider trading cases, but only in the Second Circuit. In deciding to seek Supreme Court review, the DOJ has accepted the risk the Supreme Court might affirm Newman and therefore make Newman the law of the land. Why take the risk? The DOJ obviously believes it will win the appeal. But even if it loses and Newman becomes the law throughout the country, the impact would not be that great because most insider trading prosecutions are in the Second Circuit anyway.”