‘Private State Actions to Disgorge the Wrongful Gains of Insider Trading’

Jeanne L Schroeder, ‘Taking Misappropriation Seriously: State Common Law Disgorgement Actions for Insider Trading’ (February 11, 2021) Cardozo Law School Legal Studies Research Paper No 625, available at SSRN. The disgorgement remedy strips a defendant of unjust profits. Disgorgement is gaining prominence as a civil remedy across a varied body of substantive laws, including intellectual property, contracts, fiduciary duties, as well as in government enforcement litigation to battle fraud and corruption. Disgorgement’s provenance ties to restitution and the equitable accounting for profits remedy. Even as memory of its equitable history fades, modern and novel applications of disgorgement flourish. Disgorgement relies on restitutionary principles because its primary goal is to undo unjust gain. It also deters opportunism and disincentivizes misconduct … (more)

[Caprice Roberts, JOTWELL, 6 May]

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