Under the classical theory of insider trading, corporate insiders, such as the directors, officers, and employees of a company, are prohibited from trading based on material non-public information (MNPI) that they have obtained in connection with their positions in the company.  This theory targets a corporate insider’s breach of duty to the shareholders with whom the insider transacts.1

1 See United States v. O’Hagan, 521 U.S. 642, 652 (1997).

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