327 F.3d 1263 (2003)
- The SEC provided sufficient evidence both that an agreement of confidentiality and a history or pattern of sharing and keeping of business confidences existed between the wife and her husband such that the husband could have reasonably expected the wife to keep confidential what he told her about his company's pending announcement.
- Moreover, the SEC provided sufficient evidence to prove that the wife expected to benefit from disclosing the confidential information to her co-worker given that the two were friendly, worked together for several years, and had split real estate commissions over the years.
- Thus, the wife expected to benefit from the tip by maintaining a good relationship with the co-worker.
- However, the district court erred in instructing the jury on the elements of the SEC's claims because the severely reckless jury instruction was inconsistent with the requirement that the SEC establish that the wife (the tipper) intended to benefit from the tip.
- The wife and co-worker were prejudiced by the instruction as it was likely to have affected the jury's verdict.
- Thus, the wife and co-worker were entitled to a new trial.
The district court's decisions denying the wife's and co-worker's motions for judgment as a matter of law were affirmed, but the judgment was vacated due to prejudicial error in the district court's instruction on the elements of the misappropriation theory of liability. The case was remanded for a new trial.
Suggested Study Aids For Securities Regulation Law
Securities Regulation in a Nutshell, 10th (Nutshell Series)
Securities Regulation: Examples & Explanations, 5th Edition
Securities Regulations: The Essentials