We have a very interesting, and complex situation unfolding here.
A company insider, who has shunned company 'inside' information, in an attempt to remain unconstrained when trading his shares, has inadvertently, by virtue of his holdings, become aware of significant inside information.
The company's landlord, apparently unable to contact the management through normal channels, has contacted the largest individual stockholder to ask certain questions of the company. Unbeknown to the landlord the investor in question was probably unaware of anything that would be of any use to him specifically because the insider has avoided such information so carefully.
In the course of their conversation certain information became known to the insider, perhaps based on information passed along directly or information deduced from questions that were being asked. Whatever the manner that the information was transfered the insider was upset enough to question the motives of the landlord and characterize him as both an impostor and a scaremonger.
We have since learned from the landlord that it was, in fact, he that contacted the insider and we have learned from the insider that he is now aware that the landlord was not an impostor. Additionally we have learned that the company is up to date with its rent.
So here is the question. Since the insider now has information that is not public and was characterized as 'scaremongering' when thought to be presented by an impostor, can he legally act on that information and trade his shares without running afoul of the insider trading laws?
As outsiders, not privy to the discussions, but being aware of the relationship between the mischaracterized scaremonger and the company, that of landlord tenant we can probably guess at the type of information that was involved.
Assuming the truth of the rent being up to date, there are very few other possibilities. Lease issues and or Eviction problems would seem to be the limits of concerns from a landlord to a tenant that do not involve the immediate issue of past rent.
Does anyone have any suggestions as to the legal issues that face an insider in such a situation? Can he sell his shares? Is he free to divulge the information? Is such information when involved with a publicly traded company allowed to be kept private?
regards,
frog
