Does the Securities Exchange Act Apply to Short-Swing Profits Abroad?
Section 16(b) of the Securities Exchange Act requires statutory “insiders” of companies that are registered with the Securities Exchange Commission (SEC)—such as officers, directors, and certain beneficial owners—to disgorge profits from “short-swing” trading within a six-month period. It is a strict liability provision that does not depend on the insiders’ intent. On May 23, 2025,…
Continue ReadingWhen Is a Securities Transaction “Domestic” Under Morrison?
In Morrison v. National Australia Bank (2010), the Supreme Court held that § 10(b) of the Securities Exchange Act applies only to “transactions in securities listed on domestic exchanges, and domestic transactions in other securities.” This holding doomed the securities fraud claims in Morrison because the plaintiffs purchased their shares on the Australian Securities Exchange….
Continue ReadingDistrict Court Applies Securities Fraud Provision to Foreign Transactions
Does § 10(b) of the Securities Exchange Act apply to securities on foreign exchanges? Generally, the answer is no. The Supreme Court held in Morrison v. National Australia Bank (2010) that § 10(b)—the Act’s principal antifraud provision—applies only to transactions on U.S. exchanges and to transactions in unlisted securities that occur in the United States….
Continue ReadingEnforcing U.S. Securities Judgments Against Chinese Companies
Robin Hui Huang and Weixia Gu have an interesting paper up on SSRN about enforcing foreign securities judgments in China. In China’s Recognition and Enforcement of Foreign Securities Judgments Against Overseas-Listed Chinese Companies, they note that private securities litigation against Chinese companies in U.S. courts is increasing. But most Chinese companies listed in the United…
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