Quote:
Originally posted by Mmmm, Burger (C.J.)
I agree it's novel, but given how precipitously her company's stock declined after she was indicted (or when it was rumored she would be), her involvement (if any) in the matter was material to a lot of investors.
If Warren Buffet falsely denied an arrest that could send him to jail for years, I could see the materiality of that to investors in his company. Martha Stewart, while no Buffet, certainly is runs a company whose fortunes are closely associated with her image and work.
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Sure it was material, but the question is whether it is or should be actionable under 10b-5.
ETA:
I seems to me under the government's theory that nearly public statement made by an insider could give rise to liability, whether or not it is connected with the insider's company? And how does Reg FD play into this. Do you file an 8-K for every potentially material statement made by an insider outside his or her home/office?
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