The case of Virgil and Hamilton selling their shares at lower prices is a matter of agreement between them and their buyers. They cannot succeed in a lawsuit that forces their buyers to compensate them for their loss in value due to the prevailing circumstances before they made their decision to sell. In this case, there are procedures to make the sale and agreement forms that were filled with signatures to signify their willingness to sell their shares at the agreed value. As long as there was a contractual agreement between the parties, they cannot prove otherwise so as to get compensation.
The situation for Virgil was that he had financial problems, and the sale was the solution to minimizing the monetary troubles. Therefore, he was given the business environment and the prevailing conditions, and the decision was made to dispose of the shares to as part of the financial solution. In addition, an offer was made and accepted although it was sugarcoated as a favor for old times sake by the girlfriend. This can be considered as the negotiation and Virgil had the power to refuse to make the transaction before formalizing their contractual agreement hence the improbability of getting any compensation.
A similar case is for the Hamilton purchase where the buyer and seller have not indicated any irregularly in the transaction process. What can be deduced is that sellers were given offers, and they accepted them to sell at the price they thought was fair. In the securities exchange regulations, elaborate procedural frameworks are outlined, and once they are formalized, the transactions are complete and non-reversible. Despite the anger from Virgil and Hamilton, they have no way to successfully launch a lawsuit to gain compensation for their losses. This is because they were given factual information about the company and they acted on it, making their sale legal even if the value was lower; and, they could not predict the future about market changes.
The SEC can have a successful legal proceeding against Lance and Landon based on their positions, duties, and responsibilities at the time of share purchases. For Lance, he was among the attorneys representing the company and was assigned the job of preparing paperwork for the tender offer. This can be considered as having insider information about the proceedings of the company and using such information from this level for financial gains is illegal. As indicated, these lawyers were instructed by the company to keep the details in secret but opted to violate such requirements and take actions that provided financial benefits.
Every professional has responsibilities, and their violations amount to legal consequences which are being pursued by the SEC. Knowing the details of the takeover and using this information knowingly against professional responsibilities is tantamount to investigations and provision of appropriate punitive measures. This is reinforced by the fact that Lance speculated the stocks and sold them later to make 600,000 dollars of which could not have happened if he did not use insider information to purchase the shares against the clients specifications of secrecy.
In fact, the law states that purchasing the shares on the basis of non-publicly available information about security or issues is a breach of duty, confidence, and trust. Also, it means that fiduciary duty was breached to the source of information and trading with it for self-serving interests is liable for legal consequences according to individual professional requirements. Since Landon used insider information from Lance, he is also liable for the damages caused by their purchase since he made 200,000 in a manner that is not legally accepted by the regulatory agencies.
Analinda cannot return the profits gained from her purchase and sale of company shares because there exists no legal basis to compel her to make compensations. This is because the transactions that led many people to sell their shares and use insider information to make financial gains as in the case of Lance and his friend. The shares were bought in 2012 at their market price of 10 and 11 dollars per share at the time. In addition, they were sold in the year 2013 at the cost of 12 dollars per share. Despite sitting on the board, she could not have known about the incoming takeover of the company, and it cannot be proven that she used her position of protected information for financial gain.
In other words, the offer for the takeover was given in 2014 and the company was sold in the same year thus there was a timespan of more than 12 months prior to the occurrence. Since the future could not be predicted by Analinda, she is not liable for anything, and her decisions were based on the then prevalent situational conditions, excluding information that could be leveraged. The difference can be illustrated using others who used insider information to purchase shares at low prices and later selling them at a profit of more than 5 dollars to make massive profits.
Therefore, it is arguable that Analinda cannot turn over all profits made in 2013, one year later. If the company thought that the transactions were wrong, they were supposed to be intercepted during their occurrence or immediately after, not one year later. This can be interpreted as having malicious intent against one of the directors since the claims have no legal basis to compel Analinda to hand over profits made through a verifiable trading process.