A Stockholder Must Be a Beneficial Owner Before Initiating a Purchase/Sale Short-Swing Transaction to be Subject to Liability Under Section 16(b) for Profits Realized on the Transaction

Date

1976

Journal Title

Journal ISSN

Volume Title

Publisher

Texas Tech Law Review

Abstract

Explains the United States Supreme Court case, Foremost-McKesson, Inc. v. Provident Securities Co. In that case, the Court held that in order to be subject to liability under Section 16(b) of the Securities Exchange Act of 1934, the stockholder must be a “beneficial owner who might be able to initiate both the purchase and sale on the basis of advance information” prior to initiating a short-swing transaction. The author hopes that the Court will clarify section 16(b) further by eliminating the confusion surrounding that section’s exception clause.

Description

Keywords

Short-swing transaction, Securities, Section 16(b), Beneficial owner, Regulation, Foremost-McKesson, Inc. v. Provident Securities Co., Case note

Citation

7 Tex. Tech L. Rev. 780