Gustavo Ballvé on April 5th, 2011
Corporate Governance, Food for thought, Home, Signal or Noise

Much has been said and written in the days since the Dave Sokol story broke – most of it noise, speculation, personal attacks and so on. But there are some valid criticisms, questions and at least one new piece of relevant information in Andrew Ross Sorkin’s story today in NYT’s Dealbook. The new info seems serious: apparently Mr. Sokol bought shares one day “after he told Citigroup to indicate Berkshire’s interest in buying the company”. Legal professors seem to agree that it is not “material information” in the letter of the insider trading regulations, but it’s one more factor highlighting that in the spirit of Berkshire’s own Code of Conduct – and in light of the obvious appearance of conflict of interests and front-running – Mr. Sokol should have thought twice.


Now for the noise part:

Alice Schroeder’s quip on the subject. Keep in mind her personal issues with the company.

Allan Horwich, a professor of law at Northwestern U., clarifies the “is it insider trading?” question. Technical but interesting.

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