The U.S. Court of Appeals for the Second Circuit heard oral arguments earlier this month in a major insider-trading case following the U.S. Supreme Court’s ruling in Salman v. United States last year.
The appeal, United States v. Martoma, 14-3599, provides the circuit the opportunity to address its ruling in United States v. Newman in the light of Salman. Since the high court’s ruling, there’s been uncertainty over how much of Newman—which the Supreme Court declined to hear after the circuit reversed the convictions—remains after Salman. The panel of Judges Rosemary Pooler and Denny Chin and Chief Judge Robert A. Katzmann now has a chance to speak to the issue of the relationship between tipper and tippee, which Newman found must show “proof of a meaningfully close relationship that generates an exchange that is objective, consequential, and that represents at least a potential gain of a pecuniary or similarly valuable nature.”
