Question: Intercontinental Widgets, Inc., had applied for a patent for a new state-of-the-art widget, which, if patented, would significantly increase the value of Inter-continentals shares. On

Intercontinental Widgets, Inc., had applied for a patent for a new state-of-the-art widget, which, if patented, would significantly increase the value of Inter-continental’s shares. On September 1, the Patent Office notified Jackson, the attorney for Inter-continental, that the patent application had been approved. After informing Kingsley, the president of Intercontinental, of the good news, Jackson called his and purchased one thousand shares of Intercontinental at $18 per share. He also told his partner, Lucas, who immediately proceeded to purchase five hundred shares at $19 per share. Lucas then called his brother-in-law, Mammon, and told him the news. On September 3, Mammon bought four thousand shares at $21 per share. On September 4, Kingsley issued a press release which accurately reported that a patent had been granted to Intercontinental. The next day Inter continental’s stock soared to $38 per share. A class action suit is brought against Jackson, Lucas, Mammon, and Intercontinental for violations of Rule 10b–5. Who, if anyone, is liable?

Step by Step Solution

★★★★★

3.31 Rating (175 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

Jackson Lucas and Mammon are all liable for violating Rule 10b5 by trading on inside information Whe... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Document Format (1 attachment)

110-L-B-L-B-R (86).docx

120 KBs Word File

Students Have Also Explored These Related Business Law Questions!

Case Study - Sleep Apnea After interviewing Senior Reynold, you note the following: Mr. Reynold is under considerable stress. He owns his own business. The stress of overseeing his employees, meeting...

The Befort Company filed for a patent on a new type of machine. The application costs totaled $12,000. R&D costs incurred to create the machine were $75,000. In the year in which the company filed...

The Befort Cozmpany filed for a patent on a new type of machine. The application costs totaled $12,000. R&D costs incurred to create the machine were $75,000. In the year in which the company filed...

Intercontinental Widgets, Inc., had applied for a patent for a new state-of-the-art widget that, if patented, would significantly increase the value of Intercontinentals shares. On September 1, the...

Hi Sara, Please find my attachments for your information. Thank you Masoumeh P 3-2 P 3-2 The following information was obtained from the accounts of Lukes, Inc., as of December 31, 2012. It is...

Calculate these numbers for 2010 Annual Report Net Income Preferred Dividends Average Common shares outstanding Stock price per share Earnings per share Gross profit Net Sales Average total assets...

Hi! I need help for this assignment, please let me know if WEEK 6 WILEYCPA Ownership of 51% of the outstanding voting stock of a company would usually result in The use of the cost method. The use of...

Write an engagement letter of no more than 1,050 words for a Section 404 audit of Apollo Shoes. Assume that Apollo Shoes is a publicly traded company for which the SEC requires an audit of internal...

Discuss the effect of damping on vibratory systems. What is meant by under damping, critical damping and over damping?

Suppose that one day, Gilligan (the castaway) eats a magical island plant that turns him into an expert at everything. In particular, it now takes him just half an hour to pick a quart of berries,...

Do you agree with Tom that this is a motivation issue? Why or why not?

Master schedules are expressed in three different ways depending on whether the process is continuous, a job shop, or repetitive. What are these three ways?

Joe Brown gave to his wife, Mary Brown, $35,000 with which to buy real property. They orally agreed that title to the real property should be taken in the name of Mary Brown but that she should hold...

State whether or not a trust is created in each of the following situations: (a) A declares herself trustee of the bulk of my securities in trust for B. (b) A, the owner of Blackacre, purports to...

The states of California and Nevada established the Tahoe Regional Planning Agency (TRPA) to study the impact of development on Lake Tahoe. The TRPA imposed two moratoria beginning in 1981, totaling...

5. Red Buckle Inns plans to issue $85,000,000 of 20-year semi-annual bonds in January to help finance an expansion including 120 new hotels. It is now September, and the current cost of debt to the...

A mining company is considering a new project. Because the mine has received a permit, the project would be legal; but it would cause significant harm to a nearby river. The firm could spend an...

1 . In learning unit 1 you are introduced to a variety of policy and legislative measures in managing public finance. In your view, which one of these measures is themost important guidelinefor a...