Assignment 7 - Insider Trading

Assignment 7 - Insider Trading - InsiderTrading? Business...

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Insider Trading? Business Law II (BA265) Robert McGill 25 August 2011
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Insider Trading?  1 In this scenario, we discuss Manny. Manny works for Medivac. Medivac is a manufacturer of spinal surgical equipment. Medivac is in preliminary talks with Medtronic to merge with Medtronic. Medtronic is the leader in spinal surgical equipment. Manny calls his brother Mitchell on Monday. Manny tells Mitchell to purchase shares in Medivac as the proposed merger will be announced on Wednesday. Manny purchases $5 million dollars in Medivac shares. The merger is announced and Medivac stock soars from $5 dollars to $50 dollars. Did Manny violate federal securities laws? If so, what law and why? T he term "insider trading" actually includes both legal and illegal conduct. The legal version is when corporate insiders—officers, directors, employees and large shareholders, buy and sell stock in their own companies. When corporate insiders trade in their own securities, they must report their trades to the SEC. Many investors and traders use this information to identify
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Assignment 7 - Insider Trading - InsiderTrading? Business...

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