Jenner & Block

Client Alert - U.S. v. Newman: Second Circuit Reverses Remote Tippees' Convictions for Insider Trading Where Tippers Never Charged

This client alert examines U.S. v. Newman, in which the U.S. Court of Appeals for the Second Circuit reversed the convictions of two hedge fund managers who had been found guilty of insider trading as “remote tippees.”  While the decision may lead to the reversal of several prior convictions and guilty pleas, and will make it harder in the future for the Government to prove insider trading against “tippees,” three aspects of the decision suggest the practical implications may be less sweeping than some have predicted.