You are a young associate making six figures. Raising your hand to uphold the integrity of your profession is a fairly recent experience. You are asked to review a draft letter of intent relating to a potential merger involving one of your clients. What to do?
According to a lawsuit filed last week by the SEC, Melissa Mahler, a former Nixon Peabody associate in this very position, immediately picked up the phone and asked her broker to buy 10,000 shares of her client’s stock. Post-merger she sold the shares for a $5,800 profit.
The client was Telphus Consumer Services, and its merger with online travel company Rooms.com was announced in 2004. Mahler left the firm in 2005 when her alleged insider trader came to light.
The ABA Law Journal printed a statement from the firm: “Ms. Mahler was briefly employed by the firm and left nearly five years ago, immediately after we learned that her personal conduct had come under regulatory scrutiny. We have cooperated with the government’s investigation and intend to continue doing so.”
According to the suit, Mahler is now a sole practitioner in New York.
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