LAW 3111H Lecture Notes - Lecture 28: Insider Trading, Derivative Suit
Section 16 in Exchange Act
if you are the owner of 10% of company
director or officer
you have to file a report
saying how may share su own
if u bought or sold shares in that company

Section B
if you are beneficial owner (own 10% and are director or officer) if you make money
in any 6 month time period from buying selling stocks
corporation can recover any profits made
or it may authorize a derivative action against shareholders
to help prevent insider trading

but also just stock price manipulation
director officer can do things that can hurt the company (especially in short term)
- make stock drop like a rock
- even if temporarily it would cause fluctuation

basically just any profits in this window are out
both overinclusive and underinclusive
underinclusive bc

useful but flawed

Who are the traders?
1. director
2. officer
3. own 10% company
needs to fit 1 of the 3 to qualify

have they made purchases or sales within 6 month period
