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Federal Judge Bars Instant Publishing of Analysts' Stock Tips

Posted by timothy on from the you-can't-say-that-just-yet dept.

An anonymous reader writes "Big Banking firms Barclay's Capital, Morgan Stanley, and Merrill Lynch successfully obtained an injunction against theflyonthewall.com, Inc., preventing them from immediately publishing the firms' stock upgrades and downgrades. This case could have far-reaching consequences concerning internet communication and publication of news." Here's some interesting analysis from Paul Levy, via Dave Farber's Interesting People list.

1 of 133 comments (clear)

  1. No, insider trading by gr8_phk · · Score: 5, Interesting
    It's not a trade secret when you share ratings with your clients several hours before you release information to the public. From TFA:

    This time frame preserves incentives for the firms to create and disseminate research reports to their investor clients, while still recognizing the inevitable, fast-moving, and widespread informal communication of recommendation on Wall Street.

    Obviously these reports will affect prices, so you tell clients, wait a bit so they can react, and then tell the public. That's market manipulation plain and simple. A more fair ruling would say they have to release the reports publicly at the same time they tell their clients. But then this is a Manhattan federal judge who knows who he works for ;-)