Would this be legal?

Yeah, it seems to me that it's a weird result that flows from the way tipper/tippee liability works. I think the personal gain rule was a way for the people setting the standards to distinguish between someone disclosing for the purpose of trading and someone who is just talking when they shouldn't. That goal seems reasonable to me, as you want special punishment for people actively gaming the system. What doesn't make as much sense is that the tippee's liability is always derivative of the tipper. That's why we might be able to say "yeah, I thought it was MNPI, but since I knew the tipper wasn't doing it for a gain I went ahead and traded." I don't really think that's the intended result, but it seems like that's where the decisions have gone.

For sure I don't think it's a good idea for him to tell us. I think you're right in pointing to breach of fiduciary duty as the law being broken if he were to tell all of us. I think we'd be in the clear to trade, though.
 
Will your profit be enough to cover your legal fees in the event of an SEC enforcement case.

Sure, they might lose, but you will be out at least 200k in legal fees.

Forget whether its legal or not, its stupid.
 
This is just a wild-assed guess, but would posting it on a message board make the information public? Word sure travels quickly on the Internet. Or is something more formal (and more credible) like a press release necessary?

Obviously, rogue employee Alum03 could release the info, make it public, and then trade on it legally (of course the efficient markets theory predicts he wouldn't make any money). Of course, doing so would constitute a number of business torts, but it would get around the SEC issues. Would a message board posting be sufficient?
 
HHH, I'd thought about that question myself. It seems to me that this message board probably wouldn't qualify, as no trader would ever think to look here for hot stock tips. Post it on something like Yahoo finance, though, and I think that would make it public.
 
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