Merrill Lynch, Pierce, Fenner & Smith, Inc. v. Livingston

566 F.2d 1119 (9th Cir. 1978)

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Nature of the Case

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Facts

Livingston (D) was employed by Merrill Lynch (P) as a securities salesman from 1951 to 1972. Eventually, D was given the title of Vice President, but he had exactly the same duties as he did before this recognition. D never attended, nor was he invited or permitted to attend, meetings of the Board of Directors or the Executive Committee. D acquired no executive or policy-making duties. Those functions were performed by approximately 350 Executive Vice Presidents. In other words, D got no special information of any kind from the company other than that internal information distributed to salesmen in the company about sales statistics. P got a judgment against D for $14,836.37 from the profit that D made on short-swing transactions in the securities of P in violation of 16(b).