Matt Levine, Columnist

Insider Trading Law Can't Handle Nest and Nestor

It's not just the stock price; this is probably more press attention than Nestor, Inc. has ever gotten.

January 16, 2014 at 6:01 PM EST

Matt Levine is a Bloomberg Opinion columnist. A former investment banker at Goldman Sachs, he was a mergers and acquisitions lawyer at Wachtell, Lipton, Rosen & Katz; a clerk for the U.S. Court of Appeals for the 3rd Circuit; and an editor of Dealbreaker.

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The Nestor/Nest insider trading thing that we talked about earlier is pretty dumb but there's actually an important question lurking in it. Financial fraud law is built around a thing called "materiality." So to be guilty of insider trading, you need to trade on "material nonpublic information" that you obtained through someone violating a duty to someone else. The duty stuff is complicated and people frequently forget it. But "material" is hard too, and worth talking about.1

What does material mean? Well here are some words, though I don't know that they're all that edifying:

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