A Key Ruling On Materiality In Insider Trading Cases

Tue Sep 16 12:50:00 EDT 2008
Dr. Marcia Kramer Mayer and Cory Hohnbaum, Partner at King & Spalding

In this guest column for Securities Law360, NERA Senior Vice President Dr. Marcia Kramer Mayer and Cory Hohnbaum, a Partner at King & Spalding, discuss the ramifications of a recent ruling in which the Honorable Graham C. Mullen, a federal court judge in Charlotte, North Carolina, granted John F. Mangan Jr.'s motion for summary judgment and dismissed the SEC's insider trading claim against him. The SEC had alleged that Mr. Mangan intended to fraudulently take advantage of material non-public information concerning a Private Investments in Public Equities (PIPE) transaction by selling short pre-announcement. Dr. Mayer and Mr. Hohnbaum, who served as Mr. Mangan's materiality expert and counsel, respectively, in this litigation, note that the ruling deals a serious blow to the SEC's efforts to curb what it considers abuses relating to trading in PIPEs.

Learn more about Dr. Mayer's role in Securities and Exchange Commission vs. John F. Mangan, Jr.