{"id":34637,"date":"2008-03-26T16:35:41","date_gmt":"2008-03-26T21:35:41","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/uncategorized\/court-rejects-claim-for-disgorgement-of-short-swing-profits.html"},"modified":"2008-03-26T16:35:41","modified_gmt":"2008-03-26T21:35:41","slug":"court-rejects-claim-for-disgorgement-of-short-swing-profits","status":"publish","type":"corporate","link":"https:\/\/corporate.findlaw.com\/law-library\/court-rejects-claim-for-disgorgement-of-short-swing-profits.html","title":{"rendered":"Court Rejects Claim for Disgorgement of Short Swing Profits"},"content":{"rendered":"
\n
\n

This article was edited and reviewed by FindLaw Attorney Writers<\/a><\/em><\/p>\n\n | Last reviewed\n

\n \n <\/i>\n Legally Reviewed\n <\/summary>\n\n
\n

This article has been written and reviewed for legal accuracy, clarity, and style by FindLaw\u2019s team of legal writers and attorneys<\/a> and in accordance with our editorial standards<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n\n

\n \n <\/i>\n Fact-Checked\n <\/summary>\n\n
\n

The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n<\/section>\n\n\n\n

The Southern District of New York has rejected a claim seeking disgorgement of short swing profits, despite defendant's agreement to certain lock-up provisions in connection with Quintel Entertainment, Inc.'s acquisition of a company in which he was a stockholder and his filing with the SEC of a Schedule 13D report describing himself and other stockholders of the acquired company as members of a group owning more than 10% of Quintel because, among other things, there was no evidence (i) that defendant and the other stock holders "were trying to effectuate a shift in corporate control through the disposition of Quintel stock"; or (ii) "of an agreement to attempt a corporate takeover . . . [or] to use their stock to exert influence over Quintel." In the Court's view, neither the lock-up provisions nor the SEC filing rendered defendant a "beneficial owner" of more than 10% of the shares of Quintel. As a result, he did not have to disgorge profits from his purchases and sales of Quintel stock during a six-month period. (Morales v. Quintel Entertainment, Inc., 1999 WL 987357, S.D.N.Y., 10\/27\/99)<\/p>

For more information, contact<\/u>:<\/strong>Joel W. Sternman at (212) 940-7060 or e-mail jwsternman@rosenman.com<\/u>, or Steven Binhak at (212) 940- 8846 or e-mail sjbinhak@rosenman.com<\/u><\/p><\/div>","protected":false},"excerpt":{"rendered":"

The Southern District of New York has rejected a claim seeking disgorgement of short swing profits, despite defendant’s agreement to certain lock-up provisions in connection with Quintel Entertainment, Inc.’s acquisition of a company in which he was …<\/p>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_categories":[6497,6516],"class_list":["post-34637","corporate","type-corporate","status-publish","hentry","corporate_categories-law-library","corporate_categories-law-library__science-computers-technology-law"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate\/34637","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=34637"}],"wp:term":[{"taxonomy":"corporate_categories","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_categories?post=34637"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}