United States v. Bassam Salman, 2015 U.S. App. LEXIS 11555

Salman was convicted after a jury trial of conspiracy and securities fraud related to an insider-trading scheme involving his extended family.
The scheme centered on Maher Kara disclosing confidential information to his brother Michael Kara, who traded and shared profits with Salman via a family-linked trading arrangement.
Maher disclosed information from Citigroup client mergers and acquisitions from 2004–2007; Salman’s relations with the Kara family facilitated ultimate trading by Salman’s circle.
Evidence showed Salman knew Maher was the source and that the information was confidential and market-sensitive when Salman traded on it.
Salman argued the government failed to prove a personal benefit to the tipper as required under Dirks/Newman standards; the district court denied post-trial motions and Salman appealed.
After Newman was decided, Salman sought to apply its stricter standard to his case; the panel addressed the issue on the merits and affirmed the conviction.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Salman waived the sufficiency challenge	Salman emphasized insufficiency under Newman.	Salman contends Newman standard applies and was not raised in opening brief.	Waiver not applicable; merits were reached because both sides briefed the issue and argued at oral argument.
Whether the evidence showed a personal benefit or its equivalent	Maher disclosed for Salman’s benefit; gift to trading relative breached fiduciary duty.	Newman requires more than a familial relationship to show benefit.	Evidence sufficient: Maher disclosed to benefit Michael, and Salman knew of the breach.
Whether Newman controls the sufficiency standard in this circuit	Newman should govern tippee knowledge and personal-benefit requirement.	Dirks controls; Newman is not binding here.	The panel declined to follow Newman; Dirks standard governs and supports sufficiency.
Whether the insider disclosed information as a gift to a relative and thus breached fiduciary duty	Disclosures were gifts to a trading relative, satisfying breach.	No explicit benefit to tipper shown by Newman-style analysis.	Dirks-based gift theory satisfied breach of fiduciary duty; sufficient to convict Salman.
Whether Salman’s knowledge of the breach was shown beyond a reasonable doubt	Kara testimony showed Salman knew Maher intended to benefit Michael.	Salman may not have known all details of the relationship.	Circumstantial evidence allowed a rational jury to find Salman knew of the breach.

Dirks v. S.E.C., 463 U.S. 646 (1983) (personal-benefit breach includes gifts to trading relatives; fiduciary duty breach when insider discloses for personal benefit)
United States v. Newman, 773 F.3d 438 (2d Cir. 2014) (limits on proving personal-benefit; requires more than casual relationship to show benefit)
United States v. O’Hagan, 521 U.S. 642 (1997) (misappropriation theory; fiduciary duty to tipper’s client or employer)
United States v. Jiau, 734 F.3d 147 (2d Cir. 2013) (personal-benefit broadened to include gifts to trading relatives; supportive authority for Dirks framework)
Hall v. City of Los Angeles, 697 F.3d 1059 (9th Cir. 2012) (exception to ordinary waiver rule when parties have opportunity to brief issue)
Ibarra-Flores v. Gonzales, 439 F.3d 614 (9th Cir. 2006) (non-prejudicial consideration of arguments raised by appellee)
Ullah, 976 F.2d 509 (9th Cir. 1992) (standard for appealing issues left unresolved in opening brief)