Alex is an attorney representing Beron Enterprises. Alex learns that Beron Enterprises is about to purchase TrieffCorp, a publicly traded company. Alex knows that the price of the stock will rise as soon as Beron Enterprises announces the acquisition. Based on this information, Alex purchases stock in TrieffCorp. Alex is
a. liable under tipper/tippee theory
b. liable under misappropriation theory
c. liable under the Private Securities Litigation Reform Act of 1995
d. not liable because he is not an insider
Answer: b. liable under misappropriation theory
You might also like to view...
The most common form of _____ is the pilfering of items of small value, such as office supplies and small hand tools, or actions such as making copies for their children to use at school or otherwise using company resources to make personal items.
A. violation of governmental regulations B. contract violation C. property risk D. employee theft
The common stock of Big Birds Unlimited has a required return of 8 percent and a growth rate of 4 percent. The last annual dividend was $.60 a share. What is the current price of this stock?
A) $7.50 B) $7.80 C) $10.00 D) $15.00 E) $15.60