Court Of Chancery Upholds No Trading Rule

Posted on January 6, 2012 by Edward M. McNally

Steinhardt v. Howard-Anderson,  C.A. 58787-VCL (January 6, 2012)

A class representative may not trade in the stock held by his class members based on information he learns in the litigation.  That is the usual rule reflected in the typical confidentiality order entered in such cases in Delaware.  This decision collects several other unreported decisions following that rule and shows how to calculate the trading profits that must be returned to the class when the rule is violated.

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