Insider trading due to mis-sent email? Something that happened to a friend recently. This friend is in charge of negotiations for company A. An individual from company B, accidentally sent my friend minutes from a recent meeting outlining a lot of information that can be useful for my friend in company A during the negotiations. Naturally, if he were to use information it could be construed as insider trading (a rather serious offense). A point of interest is that in the email from company B a disclaimer was attached stating the usual: "if this went to the wrong sender then don't read it, only intended for internal use, blah blah." Now two points I found interesting, and correct me if I am wrong: the disclaimer isn't legally binding e.g. there is no two-party consent - its one sided. Secondly, one could assume a perfectly ethical individual would not have looked at the email any further after understanding what the contents of that email contained, should they have not noticed that it was not intended for them. Thus, my question. Say company A and B were negotiating on a price. Company's B minutes state on the first line of the email that their max price is 100. Company A was willing to sell for 70. My friend, having read the first line may not choose to act on the information in the document so as to avoid insider trading, however, it is hard to deny the fact that having read that document he will negotiate differently at even a subliminal level. It's like in poker, you know the other persons hand through a reflection in the mirror. Would my friend be acting in an illegal manner? Full disclosure: this is for my own curiosity. My friend is already consulting the companies lawyer, and informed company B of the email.
First of all, this is not insider trading: insider trading is using non-public information to trade a publicly tradable security. What this could be is misuse of confidential information - a civil tort. The disclaimer does not create a legally binding contract for a number of reasons but it does alert the recipient that the information is confidential: if they use it then they can be sued for damages (probably successfully). However, given the nature of the information, it is almost impossible for your friend not to act on it and Company B should realise this. Legally he is doing the right thing, consulting a lawyer and informing Company B of its colossally massive stuff up. Ethically he may need to withdraw from the negotiations.
I'm not familiar with this law, but if it works like other tax confidentiality laws I'm familiar with, it would be interpreted so broadly that there would effectively be no difference between "facts," "particulars" or "information." People receiving tax returns under this law would be prohibited from disclosing any of them. Anything that is in the return would be considered secret.
First, shares are a form of raising capital. A company must have some capital, and Bob receives the shares in exchange. So it is not free (the exact minimum would depend of the requirements for incorporating). In both cases, Bob is not only a shareholder but the manager of Bob Limited. Bob will not incur liabilities for being a shareholder, but he can be at fault for his actions as a manager (for example, if he gives false financial data about Bob Limited in order to get credit for investing). Do not confuse Bob the Managerand Bob the Shareholder, as they are different roles. Of course, if you are a trading company and Bob the Manager approachs you asking for credit for Bob Limited, you will have to consider which assets Bob Limited has to cover possible debts, and you will ask him the books or other proof. If Bob the Manager provides you the correct information about Bob Limited and does nothing "funny"1, Bob the Manager is off the hook; you did provide credit hoping to get profits but you knew that there was a risk, and you were given the data needed to evaluate that risk. If Bob the Manager did things the wrong way (he did "cook" the books, he did provide false data or he did appropiate Bob Limited money) then Bob the Manager will probably be prosecuted. But Bob the Shareholder will not be liable for this, he will only lose the assets he did put forward as capital as the Bob Limited value will drop to zero. B) does not change much the situation, Matt still only loses his part of the company2. The difference here is that if Bob the Manager did "funny" things and did not manage the company correctly then Matt may sue Bob the Manager, too. 1For example, using the assets borrowed to buy a nice mansion and then selling it to Bob the Shareholder (or to Bob the Manager) for $1. 2Which is not valued at $50 but as half the net worth of the company. Of course, if the company was valued at $100.000.000 and Bob the Shareholder sold half of its shares for $50, people from the tax office are likely to come asking lots of questions.
Given a large database of email addresses that you can't prove have given consent to receive email, the only legal thing to do with it, is to (securely) delete it. (I am going to switch your question about a larger company to a bank: in the UK, big pharma is forbidden from advertising to individuals.) In principle the rules are the same for a huge bank and everything down to a self-employed plumber. In practice the plumber will be told "don't do that again" rather than fined. This case was treated under the Data Protection Act, which has a maximum fine of £500,000&nbsp;&ndash; so a big bank would probably have been fined more, but not necessarily much more. Under GDPR, fines are related to turnover, so the fine would be a lot bigger for a large bank. The incident is a year old now. Details here.
This follows from a term in your agreement: in opening the account, you agreed to a binding arbitration clause. The general reason why they can do this is because it is not prohibited by law to have such clauses in agreements (in fact, the Federal Arbitration Act protects such clauses from legal challenge). For the same reasons, the clauses can impose deadlines on opt-out or require opt-out by mail as opposed to email or phone call. The premise is that if you find such terms unacceptably onerous or unacceptable, you will not patronize that business. That assumes that the customer read and understood the agreement that they signed, which I grant is often untrue.
This notice has no legal power what so ever. This has been, and is being, used as a legal backup and a scare tactic. For the most part, if someone gets some sort of "sensitive" information in an email, and it was not intended for them - this notice will serve as a scare tactic to make people get rid of it because of the legal sound of the disclaimer. Also, the senders are preparing themselves for a legal battle by having the notice in email’s body. In case that the sender sent some “sensitive” data to the wrong recipient, they can be potentially held liable for privacy breach of information similar stuff. So, when they show up in court they can potentially use the argument that they did everything within their power to protect the information by adding the disclaimer and the fact that the privacy breach happened is due to a natural human error. Basically, there is no disclaimer that can protect against actual libelous or defamatory content. The most a disclaimer can accomplish in this respect is to reduce the responsibility of the company, since it can prove that the company has acted responsibly and done everything in its power to stop employees from committing these offenses. [1] If you as an employee of a company shared sensitive information or personal information by mistake, you, and the company are still liable for your own action. It can be argued in court that the recipient’s email was not verified, that a human error is not an excuse because the information could have been encrypted with a password, the information could have been transmitted via a phone call or in person, and a bunch of other excuses that will hold the company liable for damages. There is no legal doctrine or theory under which an email confidentiality disclaimer is enforceable in a circumstance like this. There is virtually no scholarly analysis of the impact of email disclaimers and very little analysis by non-scholars. One of the few authors who have commented on the subject suggests that the misconception that email disclaimers have validity may arise from the mistaken belief that the Electronic Communications Privacy Act (ECPA) somehow applies. Michael Santarcangelo, “Do Email Disclaimers Matter?,” Sec. Catalyst (Oct. 17, 2007). But, as this author points out, the ECPA prohibits only “intercepting” emails. Emails that arrive at their destination—even if the sender did not intend that destination—are not emails that have been intercepted in transit, and the ECPA is therefore inapplicable. In short, the ECPA is focused on the criminal intent of the interceptor, not the ability of the sender to execute his or her own intentions. With regard to communications with lawyers, the rules are a little different. Model Rule of Professional Conduct 4.4(b) states, “A lawyer who receives a document relating to the representation of the lawyer’s client and knows or reasonably should know that the document was inadvertently sent shall promptly notify the sender.” It is noteworthy that the rule requires only notice and doesn’t require refraining from reading the document or prohibit other use of the document. And a number of states haven’t even adopted Rule 4.4(b), so there may not be a requirement even to notify the sender in certain states. Nonetheless, if a court is examining “fairness” in connection with waiver of privilege, a disclaimer on an email sent to a lawyer might help. [4]
It might or it might not be fraud. The outcome will depend on how the facts and evidence are interpreted at trial. A more general version of this question is: If two parties discuss and orally agree to X; then sign a contract that states they agree to Y, what are the parties bound to? X? Y? Or something else? In your version, X is a fraudulent statement. And Y is an obfuscated writing. One party will argue fraud. The other will argue not fraud on the basis that all the facts were disclosed in writing. The party alleging fraud will carry the burden of proof. The standard of proof will be preponderance of evidence (more than 50%). Generally speaking, written evidence outweighs oral evidence if not accompanied by substantiating facts. Substantiating facts could be: emails or other written correspondence, a prior history or pattern of making false claims to others regarding this investment, the respective behavior of the parties after the agreement was made or anything else that corroborates the oral testimony presented at trial.
All of this is illegal. You do not give a jurisdiction so I will use NSW, Australia as an example but many countries' laws have similar effect. Australian Consumer Law prohibits misleading and deceptive conduct: It is illegal for a business to engage in conduct that misleads or deceives or is likely to mislead or deceive consumers or other businesses. It doesn't matter that what you have said is strictly speaking factual - the way it has been said is likely to mislead or deceive. However, what you are proposing goes further and IMO crosses the line into fraud (s192E of the Crimes Act): 192E Fraud (1) A person who, by any deception, dishonestly: (b) obtains any financial advantage or causes any financial disadvantage, is guilty of the offence of fraud. Maximum penalty: Imprisonment for 10 years. (2) A person’s obtaining of property belonging to another may be dishonest even if the person is willing to pay for the property. In addition to the illegality, stealing other people's money is morally wrong by any reasonable standards of morality.