O'Hagan, the SEC could successfully bring a lawsuit against Leo for damages in connection with his purchase of the shares.
Larry was not bound by fiduciary duty to Hawke. As such, the higher standard of Chiarella v. United States applies. While this 10b-5 rule applies to deliberate omission, Larry may or may not have known specifically about Leo's relationship with Hawke. Legally, however, the SEC still has recourse. The broker in the ImClone case, Peter Bacanovic, received a conviction for trading on Sam Waksal's inside information. The same legal standard is likely to apply to Larry as well, since he is a broker. There is a question as to whether this standard would apply to Foster in the case involving Howard, as he is less likely to have known that his omission constituted a fraud. For Howard, however, his position...
The shares were purchased in good faith long before the takeover bid was launched. The shares were later sold in good faith on the open market with no fraud involved, the day after the takeover bid was announced publicly. Anova did not have any covenants against selling her shares, so they were sold entirely within the boundaries of her directorship contract. As a result, Anova's transactions were completely legal and TNA has no legitimate complaint or right to demand anything from Anova. As such, she will not be required to pay TNA any of the money she made from the sale of her shares.
