Case Study 2—Insider Trading

Part 1—Case Studies

Case Study 2—Insider Trading

Insider trading is defined as using confidential information to your own advantage that hasn’t been announced publicly to make trading decisions (Insider Trading, 2013). Insider trading is monitored and prosecuted by Securities and Exchange Commission, which is also known as the SEC.

Since Brian Wilson told hiss psychiatrist Dr. Looney in confidence about the merger of Shearson Loeb Rhoades with American Express Company, he is not engaging in illegal inside trading. However, Dr. Looney took the confidential information she was given in a session and to it to Olive Green a securities broker. Green then made trades in the Shearson and American Express securities for her own advantage. Therefore, Green and Dr. Looney are engaging in illegal insider trading. Sara Wilson, Wilson’s ex-wife had nothing to do with it.

Rule 10b5-2 highlights the misuse of information when it applies to certain non-business relationship (SEC, 2015). If a person receives confidential information under circumstances such as therapy, the rule would allow that in confidence and therefore could be considered liable under the misappropriation theory (SEC, 2015).

An example of confidential information being used as an aid to insider trading is the corporate attorney and wife case. The SEC charged an attorney and his wife for insider trading with confidential information from one of his clients. The SEC’s complaint claims that Grewals violated Sections 17(a), Section 10(b) of the Securities Exchange Act of 1934, and Rule 10b-5 (SEC, 2014). Grewals was found guilty.

Insider trading is illegal and can have a twenty-five year prison sentence attached along with the crime. I believe Dr. Looney should receive the majority of the consequences seeing that she discussed confidential information of one of her patients and used the information to her own advantage which in my opinion is unethical.

Part II—Research Paper

Same Sex “Spouse” Defined Under the Federal Medical Leave Act (FMLA)

If the Federal law and the State law apply for the employee then they are entitled to the benefits under either the State and or the Federal law. The Federal Medical Leave Act does not interfere with any State or Federal law that hinders discrimination.

United States v. Windsor, Executor of the Estate of Spyer, ET AL.

Case citation: 570 U.S 12-307 (2013) 133 S.Ct. 2675; 186 L.Ed.2d 808

State or federal court: Federal Court

Issue: Same sex marriages are not covered under the FMLA laws and regulations because they are not included in the definition of what equals a spouse.

Summary of events: In the case of United States v. Windsor, Windsor helped to extend rights to couples in same sex marriages in a state that recognizes same sex marriages.

Ruling: As a result of the Windsor decision, married same sex couples now have the same rights under the FMLA as the defined spouse.

James Obergefell, et al., Petitioners v. Richard Hodges, Director, Ohio Department of Health, et al.

Case citation: 576 U.S. 14-556 (2015) 135 S. Ct. 2584; 192 L. Ed. 2d 609; 83 U.S.L.W. 4592; 25 Fla. L. Weekly Fed. S 472; 2015 WL 2473451; 2015 U.S. LEXIS 4250; 2015 BL 204553

State or federal court: State Court

Issue: Even though same sex marriage laws have began to grow individuals in same sex marriages were effected by states who did not recognize same sex marriages.

Summary of events: In the case Obergefell v. Hodges, the Supreme Court ruled in support of the fourteenth amendment of the United States Constitution that requires states to recognize the marriage two people of the same sex even if licensed in a different state.

Ruling: the decision made same sex marriage legal in all 50 states in the United States even the thirteen states that don’t recognize same sex marriages.

Reference

Insider Trading. (2013, January 15). Retrieved June 04, 2016, from https://www.sec.gov/answers/insider.htm

SEC Charges Corporate Attorney and Wife With Insider Trading on Client’s Confidential Information. (2014). Retrieved June 04, 2016, from https://www.sec.gov/news/pressrelease/2014-290.html

SEC Enforcement Actions: Insider Trading Cases. (2015, January 28). Retrieved June 04, 2016, from https://www.sec.gov/spotlight/insidertrading/cases.shtml