Funds Avoid Short-Swing Liability in Genius Brands Trial (1)

Two sets of funds that held shares in Genius Brands International Inc. obtained a jury verdict absolving them of liability for short-swing trading as part of a coordinated group.

The trial was the first ever to test the “group trading” issue under Section 16(b) of the Securities Exchange Act, law firm Freshfields said Monday in a press release about the verdict. The jury in the US District Court for the Southern District of New York found in favor of the Empery Asset Management and Brio Capital entities June 18, according to the firm, which represented Empery.

The verdict followed other ...