LAW 3111H Lecture Notes - Lecture 26: Fiduciary, Insider Trading, Tender Offer
Grand Met retained Dorsey & Whitney in connection with its planned takeover of
Pillsbury. O’Hagan is a D&W partner, not working on deal. Finds out about it and
purchased Pillsbury securities. When Grand Met announced its tender offer in
October, the price of Pillsbury stock rose from $39 to nearly $60 per share. O’Hagan
profits = $4.3 million.
O’Hagan:
not working on deal
not involved with it
purchases pillsbury securities
total slimebag
reason doing this, he was covering up embezzlement he had already done
tipper & tippee: no relationship like that where anybody was talking to him
you have to have some level of fiduciary duty breach in order to get to insider
trading
the question that was presented here: you have this requirement for insider trading”
breach of fiduciary duty” up until this point,
duty to company that you were securities traded in → pillsbury stock → but
no fiduciary duty to pillsbury
he has a fiduciary duty to Dorsey & Whitney
this is a
break
, no breach of duty for stocks he bought
information of Pillsbury belongs to D&W
did u breach duty to more or less
someone
he breached duty to law firm
& Grand Met
and used info to purchase but he is guilty
non-exclusive: you can est. duty another way
person agrees to maintain info in confidence
attorney client relationship it is a given that confidentiality is expected
husband & wife now have an assumption ( if you are close family members) you
have same fiduciary duty to corp same as your spouse does
there is no fraud & no breach of fiduciary duty he gives them the finger and tells
them literally there is no deception
