Compliance Bricks and Mortar for October 10

These are some of the compliance-related stories that recently caught my attention.

Yet Another Study Debunks ‘Revolving Door’ Worries by Bruce Carton in Compliance Week

Although I have followed the revolving door issue closely for many years, I have never seen any actual evidence that the “SEC lawyers will go easy on firms to get a future job” theory is, in fact, true. Not only is it contradicted by my own personal experience as an SEC attorney (as I discussed here back in 2009), but it is, more importantly, contradicted by no fewer than three academic studies completed in the past two years.

Whistleblowers Fight Over SEC Award by Jill Radloff  in Dodd-Frank.com

In a case filed in the United States District Court for the Northern District of Illinois, Eastern Division, the plaintiff claims three persons collaborated to develop evidence for a whistleblower claim. The three allegedly planned to make the whistleblower submission in the name of a jointly owned entity. After reading Rule 21F-2, which states only natural persons, and not entities, may be whistleblowers, the three allegedly changed their plans and determined that the defendant would submit the claim and the three would share in the proceeds. The SEC ultimately awarded the defendant $14.7 million. The defendant allegedly reneged on the promise to share the award. The defendant allegedly settled with one of the other two, and the third commenced the action.

If the Word ‘How’ Is Trademarked, Does This Headline Need a ™? by Jonathan Mahler in the New York Times

The other thing that distinguishes this case from a typical trademark dispute is that it is thick with irony: One company is accusing another of stealing its platform for ethical behavior.

The Empire of Edge: How a doctor, a trader, and the billionaire Steven A. Cohen got entangled in a vast financial scandal by Patrick Radden Keefe in the New Yorker

The business model at S.A.C., though, was based not on instinct but on the aggressive accumulation of information and analysis. In fact, as federal agents pursued multiple overlapping investigations into insider trading at hedge funds, it began to appear that the culture at S.A.C. not only tolerated but encouraged the use of inside information. In the recent trial of Michael Steinberg, one of Cohen’s longtime portfolio managers, a witness named Jon Horvath, who had worked as a research analyst at S.A.C., recalled Steinberg telling him, “I can day-trade these stocks and make money by myself. I don’t need your help to do that. What I need you to do is go out and get me edgy, proprietary information.” Horvath took this to mean illegal, nonpublic information—and he felt that he’d be fired if he didn’t get it.