This note traces the history of rule 10b-5 and its expansion and restriction in judicial decisions. The note goes on to discuss United States v. Carpenter, a Second Circuit case that drastically expands insider trading liability. The author agues that the misappropriation theory is outside of the statutory purpose of 10b-5 and that extending the provisions to reach insider trading goes beyond the premises of statutory construction articulated by the Court.
The Misappropriation Theory: Rule 10b-5 Insider Liability for Nonfiduciary Breach,
15 Fordham Urb. L.J. 1049
Available at: http://ir.lawnet.fordham.edu/ulj/vol15/iss4/5