Last week, theU.S. Supreme Court heard oral
argument in the closely watched Salman v.
United States, the first time the court has
addressed an insider trading case since 1997. A
number of the justices appeared ready to affirm
the 9th U.S. Circuit Court of Appeals' decision in
Salman, which would hand the U.S. Department of
Justice and the Securities.
The Supreme Court is expected to address the
"personal benefit" test that has puzzled practitioners
and experts alike. Specifically, the court granted
certiorari on the question of whether the personal
benefit test articulated by Dirks v. SEC, 463 U.S.
646 (1983), requires proof that the tipper received
a "tangible" or 1'pecuniary" gain from the tip, or
whether it is enough that the insider and tippee
shared a close family relationship.