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Corporate Finance 8

Corporate Finance 8 - Campbell Taggart price increasing...

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Anheuser-Busch Case Wednesday, October 13, 2010 8:03 AM . , Issue Role Walter Suhre Paul Thayer (BOD) leaked info Friends traded on the information Who should be sued? Prices fully and immediately reflect available info Past prices (Weak form efficiency- past prices reflected in current price) Public info (Semi-strong form) All info (strong form- current price composed of all info including insider info) Insiders Senior management Any employee with info or anyone who has private/insider information Lawyers, spouses, etc. Trade based on knowledge of takeover = fraud Insider Trading Not a victimless crime Makes market more efficient?
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Unformatted text preview: Campbell Taggart price increasing S&P500 declined CT volume of trade increased and # of insider trades increased as well Fiduciary responsibility to shareholders (legal) Shareholders may sue Sue investment firms? Brokers employers responsible for actions of broker Conclusion Thayer pledge guilty to justice department criminal suit $5000 & 4yrs in jail Civil suit from SEC 1mil each AB Sued AG Edwards(9.9mil), Bearn Sterns (undisclosed amount) and several others for financial hardship Stock Price Move in Efficient Market No leak vs. leak x=y AB hurt x=z AB not hurt its, its...
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