The Overlooked Daisy Chain Problem in Salman

Abstract

In Salman v. United States, the Supreme Court granted certiorari to resolve a conflict with United States v. Newman as to when corporate insiders receive sufficient personal benefit from making gifts of inside information to make the tip and consequent trade illegal. This Essay explores an overlooked aspect of these cases, the “daisy chain problem,” which involves how the personal benefit element for illegal tipping applies to the subsequent tips that occur when the recipient of information from the corporate insider, in turn, passes the information on to others. This daisy chain problem could potentially distinguish the facts of Salman and Newman and thus deserves the attention of the Court and commentators.