Steve Bainbridge comments on the recently published article co-authored by Larry Ribstein regarding insider trading and “outsider trading”. The abstract of the article provided this distinction: “Trading on nonpublic information is generally permitted if the information was not misappropriated or accompanied by fraud or manipulation or other misconduct.”
Bainbridge notes in his view the following distinction: “…the critical distinction between illegal insider trading and lawful outsider trading is whether the person who trades has violated someone else’s property rights in information by doing so.” Here is the link: