Martin Estrada, Achyut Phadke on ‘Tippee’ Liability

Munger, Tolles & Olson attorneys E. Martin Estrada and Achyut J. Phadke published an article in the June 2017 issue of The Federal Lawyer about the impact of the U.S. Supreme Court decision in Salman v. United States regarding the liability for “tippees,” or individuals who receive and trade upon nonpublic, inside information.

Prior to Salman, the Supreme Court had determined that a tippee’s liability hinged on whether the insider who provided the information breached a fiduciary duty and received a personal benefit for tipping that information. In Salman, the court sought to clarify what counts as a “personal benefit.”

In the article, Mr. Estrada and Mr. Phadke outline the history of the Salman case and the court’s decision. They also discuss the court’s guidance for defining “personal benefit” and the wiggle room that remains for prosecutors and defense attorneys in that definition.

Mr. Estrada is a litigator in Munger Tolles’ Los Angeles office whose practice is focused on trials, complex litigation, internal investigations, and appeals.

Mr. Phadke is a litigator in Munger Tolles’ San Francisco office whose practice focuses on securities and complex civil litigation at both trial and appellate levels, as well as government and internal investigations.