Main Content
Corporations
Dirks v. SEC (US 1983)
Dirks is the leading case on “tippee” liability under rule 10b-5. A “tippee” is a corporate outsider who trades after receiving material nonpublic information from an insider or another tippee.
Questions:
1. According to the majority, when are tippees liable under rule 10b-5?
2. Why did the majority exonerate Dirks?
3. As a policy matter, should Dirks have been obliged to report to the SEC before telling his clients?
Supreme Court of the United States
463 U.S. 646, 77 L. Ed. 2d 911, 103 S. Ct. 3255, 1983 U.S. LEXIS 102, SCDB 1982-152
No. 82-276
1983-07-01
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