Second Circuit Review: Civil Penalties for Insider Trading

Litigation partner Martin Flumenbaum and firm chairman Brad Karp’s latest Second Circuit Review column, “Civil Penalties for Insider Trading,” appeared in the March 25 issue of the New York Law Journal. The authors discuss the unanimous opinion in S.E.C. v. Rajaratnam, in which the Second Circuit held that the penalty available in a civil insider trading action pursuant to Section 21A of the Securities Exchange Act of 1934 is not limited to a defendant’s personal profits. The decision represents an extension of insider trading enforcement authority. Litigation associate Jason Driscoll assisted in the preparation of this article.