Another SEC Setback On PIPES, Insider Trading

Law360, New York (July 31, 2009, 1:19 PM EDT) -- The U.S. District Court for the Northern District of Texas has granted defendant Mark Cuban's motion to dismiss the U.S. Securities and Exchange Commission's complaint.

The court held that the SEC failed to allege adequately that Cuban undertook a duty of non-use of information required to establish liability under the misappropriation theory of insider trading.

This article addresses the circumstances under which this motion was granted and its broader implications for the capital markets.

The Facts

According to the allegations in the SEC's complaint, in 2004...
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