concurring.
Though I am in complete agreement with the majority’s disposition of this case, I write separately to note my reservations regarding their analysis of the Guitón transaction. I agree that the joint venture violated Rule 10b-5 by trading in Guitón stock with the benefit of undisclosed material nonpublic information, but I reach that conclusion by a rather different route.
Under Chiarella v. United States, 445 U.S. 222, 100 S.Ct. 1108, 63 L.Ed.2d 348 (1980), trading on material nonpublic information does not run afoul of Rule 10b-5 unless the trader violates some specific duty to “disclose or abstain” from using the information in that way. Typically, that duty arises because of the trader’s role as a fiduciary of the corporation whose shares are traded. As the majority recognizes, however, that is not the case here. No one involved in the joint venture was a Guitón “insider.” Rather, the majority holds that the “breach of duty” element is supplied by the fact that Rosenbloom and Selzer gave their information to the joint venture, in violation of their fiduciary duties as directors of Nytronics, a corporation that was seeking to acquire control of Guitón. Under this theory, it seems to me, there would be no 10b-5 violation had Rosenbloom and Selzer simply used their information on behalf of Nytronics, because then there would have been no breach of their fiduciary duty. Though this would undoubtedly have been more desirable from the point of view of Nytronics’ share*825holders, I do not see how it would matter to the investing public at large whether it was the joint venture or Nytronics that reaped the benefits of trading on this information. If the investing public is no worse off because the joint venture, rather than Nytronics, traded on material nonpublic information, then for purposes of Rule 10b-5 this is a difference that makes no difference.
I believe the majority is attempting to bring this case within what Professor Loss has called the “misappropriation or breach-of-fiduciary-duty-to-a-third-person theory.” L. Loss, Fundamentals of Securities Regulation 867 (1983). Under such an approach, which was approved by four justices in Chiarella,1 and left open by the others,2 one may be liable for trading on nonpublic information if that information was initially entrusted to the trader by a third party for a legitimate purpose and then “misappropriated” by the trader for personal gain. Thus, the possibility was left open that Chiarella, who was entrusted by his clients with nonpublic information regarding planned tender offers in his capacity as a printer of financial documents, could be liable under 10b-5 for using that information to his personal advantage in securities transactions. Similarly, in United States v. Newman, 664 F.2d 12 (2d Cir.1981), cert. denied, — U.S. ---, 104 S.Ct. 193, 78 L.Ed.2d 170 (1983) — upon which the majority relies — employees of an investment banking firm were, in the course of their duties, privy to information regarding their client’s tender offer plans. They were held to be liable under 10b-5 for misappropriating that information for their personal gain.
In Newman and Chiarella the traders, arguably, violated an “insider’s” duty of confidentiality — albeit a duty owed to a corporation seeking to buy shares on the market rather than (as in the usual case) a corporation whose shares are to be sold. Here, however, the traders did not receive their information from the acquiring corporation, Nytronics, in the course of their duties as officers. Rather, the fact that Nytronics wished to acquire Guitón was publicly known, and Rosenbloom and Selzer were simply recipients of a strategic leak of information from an insider of the target corporation. Thus, I think the misappropriation theory is not apposite here, and it is by attempting to force this case into that particular mold that the majority reaches the anomalous result, noted above, that 10b-5 liability hinges on whether the joint venture or Nytronics used the information.
I believe that, in either circumstance, the investing public that lacks this information is being mulcted. We must, therefore, look elsewhere for a theoretical basis for 10b-5 liability. In certain circumstances, the Supreme Court has held, one who receives nonpublic information from a corporate insider — a “tippee” — also acquires a duty to disclose or abstain that “is derivative from that of the insider’s duty.” Dirks v. SEC, 463 U.S. 646, 659, 103 S.Ct. 3255, 3263, 77 L.Ed.2d 911 (1983). As the Court stated:
The need for a ban on some tippee trading is clear. Not only are insiders forbidden by their fiduciary relationship from personally using undisclosed corporate information to their advantage, but they also may not give such information to an outsider for the same improper purpose of exploiting the information for their personal gain____ [A] contrary rule “would open up opportunities for devious dealings in the name of others that the trustee could not conduct in his own.”
463 U.S. at 659, 103 S.Ct. at 3263-64 (quoting Mosser v. Darrow, 341 U.S. 267, 271, 71 S.Ct. 680, 682, 95 L.Ed. 927 (1951)).
Rosenbloom and Selzer were tippees; they received their information from a corporate insider, Dr. Guitón, who could not *826have traded on this information himself without disclosing it. Thus, the question remaining is whether, under criteria announced in Dirks, Rosenbloom and Selzer also acquired Dr. Gulton’s duty to abstain or disclose:
[A] tippee assumes a fiduciary duty to the shareholders of a corporation not to trade on material nonpublic information only when the insider has breached his fiduciary duty to the shareholders by disclosing the information to the tippee and the tippee knows or should know that there has been a breach.
Dirks, 463 U.S. at 660, 103 S.Ct. at 3264. The test as to whether a disclosure by an insider amounts to a breach of fiduciary duty focuses on “objective criteria, i.e., whether the insider receives a direct or indirect personal benefit from the disclosure.” 463 U.S. at 663, 103 S.Ct. at 3265. “For example, there may be a relationship between the insider and the recipient that suggests a quid pro quo from the latter, or an intention to benefit the particular recipient.” 463 U.S. at 664, 103 S.Ct. at 3266.
Under these objective tests, there can be no question but that Dr. Guitón breached his fiduciary duty by tipping off Rosenbloom and Selzer. By giving officers of Nytronics information regarding the intentions of the Guitón board, he almost certainly facilitated the sale of his own shares, because without confidence that it would obtain control of Guitón, Nytronics would have had little interest in Dr. Gulton’s shares. Indeed, it appears that the Guitón board may have backed away from the deal out of resentment over Dr. Gulton’s self-dealing, and when the deal fell through the price of the shares Nytronics had already purchased fell sharply. Moreover, all of this would have been apparent to any reasonable person in the position of Rosenbloom and Selzer. Therefore, I would hold that they violated 10b-5 on the theory announced in Dirks. This result in no way depends on who was the ultimate beneficiary of the tip.
. See 445 U.S. at 238-39, 100 S.Ct. at 1119-20 (Brennan, J., concurring in the judgment), 445 U.S. at 239-243, 100 S.Ct. at 1120-1122 (Burger, C.J., dissenting), 445 U.S. at 245-46, 100 S.Ct. at 1123-24 (Blackmun, Marshall, JJ., dissenting).
. See 445 U.S. at 235-36, 100 S.Ct. at 1118-19 (majority opinion). 445 U.S. at 237-38, 100 S.Ct. at 1119-20 (Stevens, J., concurring).