This document provides an overview of securities fraud law, including what constitutes securities fraud, relevant statutes, criminal penalties, and potential defense strategies. Securities fraud laws were enacted in the 1930s to promote transparency and fair disclosure in financial markets. Violations of these laws, including the Securities Act of 1933 and Securities Exchange Act of 1934, can carry criminal penalties such as fines and incarceration. The definition of a "security" that is covered is also very broad. Successful defense strategies must understand the specific elements and statutes involved in each securities fraud case.
Legal process that allows the federal government to take “ill gotten gains” from the defendant.
Inserted into numerous federal statutes and is mandatory for over 200 federal crimes.
Gross Proceeds at time of commission of the offense may be forfeitable.
Process begins immediately after sentencing.
Proceeds go to government, not victim.
Legal process that allows the federal government to take “ill gotten gains” from the defendant.
Inserted into numerous federal statutes and is mandatory for over 200 federal crimes.
Gross Proceeds at time of commission of the offense may be forfeitable.
Process begins immediately after sentencing.
Proceeds go to government, not victim.
The Constitution is an Enforceable Contractable1appeal
The US Constitution is a contract between the governement and the US Citizen enforceable by a court of law.
See the Constitution here: http://www.constitution.org/constit_.htm
The Constitution is an Enforceable Contractable1appeal
The US Constitution is a contract between the governement and the US Citizen enforceable by a court of law.
See the Constitution here: http://www.constitution.org/constit_.htm
CHAPTER 17 Investor Protection and E-Securities TransactionsNe.docxspoonerneddy
CHAPTER 17 Investor Protection and E-Securities Transactions
New York Stock Exchange
This is the home of the New York Stock Exchange (NYSE) in New York City. The NYSE, nicknamed the Big Board, is the premier stock exchange in the world. It lists the stocks and securities of approximately 3,000 of the world’s largest companies for trading. The origin of the NYSE dates to 1792, when several stockbrokers met under a buttonwood tree on Wall Street. The NYSE is located at 11 Wall Street, which has been designated a National Historic Landmark. The NYSE is now operated by NYSE Euronext, which was formed when the NYSE merged with the fully electronic stock exchange Euronext.
Learning Objectives
After studying this chapter, you should be able to:
1. Describe the procedure for going public and how securities are registered with the Securities and Exchange Commission (SEC).
2. Describe e-securities transactions and public offerings.
3. Describe the requirements for qualifying for private placement, intrastate, and small offering exemptions from registration.
4. Describe insider trading that violates Section 10(b) of the Securities Exchange Act of 1934.
5. Describe the changes made to securities law by the Jumpstart Our Business Startups (JOBS) Act and its effect on raising capital by small businesses.
Chapter Outline
1. Introduction to Investor Protection and E-Securities Transactions
2. Securities Law
1. LANDMARK LAW • Federal Securities Laws
3. Definition of Security
4. Initial Public Offering: Securities Act of 1933
1. BUSINESS ENVIRONMENT • Facebook’s Initial Public Offering
2. CONTEMPORARY ENVIRONMENT • Jumpstart Our Business Startups (JOBS) Act: Emerging Growth Company
5. E-Securities Transactions
1. DIGITAL LAW • Crowdfunding and Funding Portals
6. Exempt Securities
7. Exempt Transactions
8. Trading in Securities: Securities Exchange Act of 1934
9. Insider Trading
1. Case 17.1 • United States v. Bhagat
2. Case 17.2 • United States v. Kluger
3. ETHICS • Stop Trading on Congressional Knowledge Act
10. Short-Swing Profits
11. State “Blue-Sky” Laws
“The insiders here were not trading on an equal footing with the outside investors.”
—Judge Waterman Securities and Exchange Commission v. Texas Gulf Sulphur Company 401 F.2d 833, 1968 U.S. App. Lexis 5796 (1968)
Introduction to Investor Protection and E-Securities Transactions
Prior to the 1920s and 1930s, the securities markets in this country were not regulated by the federal government. Securities were issued and sold to investors with little, if any, disclosure. Fraud in these transactions was common. To respond to this lack of regulation, in the early 1930s Congress enacted federal securities statutes to regulate the securities markets, including the Securities Act of 1933 and the Securities Exchange Act of 1934. The federal securities statutes were designed to require disclosure of information to investors, provide for the regulation of securities issues and trading, and prevent fraud. Today, many .
CHAPTER 17 Investor Protection and E-Securities TransactionsNe.docxtiffanyd4
CHAPTER 17 Investor Protection and E-Securities Transactions
New York Stock Exchange
This is the home of the New York Stock Exchange (NYSE) in New York City. The NYSE, nicknamed the Big Board, is the premier stock exchange in the world. It lists the stocks and securities of approximately 3,000 of the world’s largest companies for trading. The origin of the NYSE dates to 1792, when several stockbrokers met under a buttonwood tree on Wall Street. The NYSE is located at 11 Wall Street, which has been designated a National Historic Landmark. The NYSE is now operated by NYSE Euronext, which was formed when the NYSE merged with the fully electronic stock exchange Euronext.
Learning Objectives
After studying this chapter, you should be able to:
1. Describe the procedure for going public and how securities are registered with the Securities and Exchange Commission (SEC).
2. Describe e-securities transactions and public offerings.
3. Describe the requirements for qualifying for private placement, intrastate, and small offering exemptions from registration.
4. Describe insider trading that violates Section 10(b) of the Securities Exchange Act of 1934.
5. Describe the changes made to securities law by the Jumpstart Our Business Startups (JOBS) Act and its effect on raising capital by small businesses.
Chapter Outline
1. Introduction to Investor Protection and E-Securities Transactions
2. Securities Law
1. LANDMARK LAW • Federal Securities Laws
3. Definition of Security
4. Initial Public Offering: Securities Act of 1933
1. BUSINESS ENVIRONMENT • Facebook’s Initial Public Offering
2. CONTEMPORARY ENVIRONMENT • Jumpstart Our Business Startups (JOBS) Act: Emerging Growth Company
5. E-Securities Transactions
1. DIGITAL LAW • Crowdfunding and Funding Portals
6. Exempt Securities
7. Exempt Transactions
8. Trading in Securities: Securities Exchange Act of 1934
9. Insider Trading
1. Case 17.1 • United States v. Bhagat
2. Case 17.2 • United States v. Kluger
3. ETHICS • Stop Trading on Congressional Knowledge Act
10. Short-Swing Profits
11. State “Blue-Sky” Laws
“The insiders here were not trading on an equal footing with the outside investors.”
—Judge Waterman Securities and Exchange Commission v. Texas Gulf Sulphur Company 401 F.2d 833, 1968 U.S. App. Lexis 5796 (1968)
Introduction to Investor Protection and E-Securities Transactions
Prior to the 1920s and 1930s, the securities markets in this country were not regulated by the federal government. Securities were issued and sold to investors with little, if any, disclosure. Fraud in these transactions was common. To respond to this lack of regulation, in the early 1930s Congress enacted federal securities statutes to regulate the securities markets, including the Securities Act of 1933 and the Securities Exchange Act of 1934. The federal securities statutes were designed to require disclosure of information to investors, provide for the regulation of securities issues and trading, and prevent fraud. Today, many .
Compare and contrast the theories of liability for insider trading u.pdfaishwaryaequipment
Compare and contrast the theories of liability for insider trading under the antifraud provisions of
Section 10(b) of the Securities Exchange Act of 1934. Analyze and evaluate the various issues
presented while arguing and debating the connections between business, law, politics, and ethics.
Solution
An understanding of insider trading law begins with The Security Exchange Act of 1934
(Act).24 This Act, a response to the 1929 stock market crash, seeks to supervise and regulate
securities trading. Section 10(b) and Rule 10b-5, the relevant provisions of the Act, form the
foundation of insider trading law. Indeed, the majority of inside traders are prosecuted under
these two provisions. Section 10(b) provides that a person may not “use or employ, in connection
with the purchase or sale of any security . . . any manipulative or deceptive device or contrivance
in contravention of such rules and regulations as the [SEC] may prescribe as necessary or
appropriate in the public interest or for the protection of investors.” Section 10(b) is implemented
by Rule 10b-5, which makes it “unlawful for any person . . . to employ any device . . . to defraud
. . . in connection with the purchase or sale of any security.” Under Rule 10b-5, the SEC can
prosecute a defendant for fraud by showing the defendant made a “material misstatement or
omission in connection with the purchase or sale of securities that has caused damages.” The
deception element is satisfied by the occurrence of a misrepresentation or an omission. However,
an omission is only deceptive when there is a duty to inform. In the context of computer hacking,
the device must be deceptive, not manipulative, due to the way “manipulative” has been defined
by the courts. The Supreme Court has ruled that “manipulative” implies defrauding shareholders
by rigging the price of securities. Hacking into a computer in no way amounts to rigging the
price of securities. While Section 10(b) and Rule 10b-5 are used to prosecute inside traders, these
provisions fail to lay out a definition of “insider trading.” Instead, courts have defined what it
means to be an inside trader, and as discussed below, the definition of an inside trader has
expanded over time.
Although the ethical and economic aspects of insider trading regulation have been discussed at
length, only recently have commentators begun to examine the political aspects of this
practice.[1] The virtual total neglect of the political side of the story is particularly curious in
light of the fact that regulation of insiders\' trading practices has become a highly politicized
issue and has prompted numerous hearings[2] and bills[3] in Congress.
At present, a battle for the right to regulate insider trading is being fought among Congress, the
regulators at the SEC, and the federal judiciary. Each of these organizations has an institutional
(if not political) interest in regulating the trading practices of insiders, and those interests are
reflected in the reg.
Companies seeking to protect their intellectual property should be aware that Congress has created a new federal law designed to prevent the actual and threatened misappropriation of trade secrets. Passed by the House and the Senate in April of 2016, the Defend Trade Secrets Act of 2016 (“DTSA” or the “Act”) is slated for President Obama’s signature, whose administration has previously expressed strong support for the law.
Darren Chaker, confidential informant guide for law enforcement, attorneys, in California, but also cites numerous federal and Supreme Court cases. Privilege is examined, how to keep confidential informants, and numerous court opinions.
York County, Virginia General District Court Filing Traffic CourtChuck Thompson
http://www.gloucestercounty-va.com Posted for a story posted on the linked website dated April 22nd, 2015. Shows how the court ignored the rules of the court and railroaded a person who was fraudulently charged in our opinion.
What You Need to Know About Insider TradingPaul Hastings
In this powerpoint, Paul Hastings partner Paul Monnin and associates Eric Stolze and Andrea Pearson cover theories of insider trading liability; evidence collection: how investigations begin, heightened stakes, mobile devices and BYOD, and feasibility; liability; and more.
www.paulhastings.com
Unclean hands doctrine, Darren-Chaker, provides this legal article with a focus on perjury by plaintiffs. Great resource and provides several appellate cases.
1. Defending Securities Fraud: A Brief Description of the Law, Elements, and Defense
Techniques
By: Amanda Whitt
I. What is Securities Fraud?
Courts broadly interpret federal securities laws.1
The Securities laws of the 1930s were
enacted to redress several perceived problems in the securities market place.2
These laws were
created to promote full and fair disclosure of material information, and therefore, attempt to
remedy the problems that led up to the stock market crash.3
The Securities Acts allow
marketplace forces to determine the quality of the securities offered and the reasonableness of
the prices and terms at which they trade.4
Essentially, securities laws are anti-fraud statutes.
Therefore, while civil remedies are available, willful violations of these Acts may result in
criminal prosecutions as a violation is considered to be a fraud against society.5
II. Securities Defined
Section 2(a) (1) of the Securities Act of 1933 defines a ‘security’ as:
any note, stock, treasury stock, security future, bond, debenture, evidence of
indebtedness, certificate of interest or participation in any profit-sharing agreement,
collateral-trust certificate, reorganization certificate or subscription, transferable share,
investment contract, voting-trust certificate, certificate of deposit for a security, fractional
undivided interest in oil, gas, or other mineral rights, any put, call, straddle, option, or
privilege on any security, certificate of deposit, or group or index of securities (including
any interest therein or based on the value thereof), or any put, call, straddle, option, or
privilege entered into on a national securities exchange relating to foreign currency, or, in
1
4-17 Business Crime p 17.11, citing Superintendant of Ins. of N.Y. v. Bankers Life & Cas. Co., 404 U.S. 6 (1971);
United States v. Russo, 74 F. 3d 1383 (2d Cir. 1996); Madden v. Cowen & Co., 556 F. 3d 786 (9th Cir. Cal. 2009).
2
3-56 Criminal Defense Techniques § 56.02, p1
3
3-56 Criminal Defense Techniques §56.02, p 2
4
3-56 Criminal Defense Techniques §56.02, p 2, citing Bentel v. United States, 13 F. 3d 327
5
Id.
2. general, any interest or instrument commonly known as a “security”, or any certificate of
interest or participation in, temporary or interim certificate for, receipt for, guarantee of,
or warrant or right to subscribe to or purchase, any of the foregoing.
15 USC 78c (10).
With the definition encompassing so many things, it is clear as to why the courts have
understood Congress to have intended an expansive definition of “security”.6
Federal securities regulatory laws are contained within six statutes:
(1) The Securities Act of 1933, codified at 15 U.S.C. 77a et seq; controlling the
registration of public securities offerings and requiring extensive disclosure of
relevant information relating to these offerings;
(2) The Securities Exchange Act of 1934, codified at 15 U.S.C. Section 78a et seq.;
governing trading on national securities exchanges and in the over-the-counter market
and requiring the registration of brokers and dealers;
(3) The Public Utility Holding Company Act of 1935, codified at 15 U.S.C. 79a et seq.;
regulating public companies and their subsidiaries engaged in electrical and gas
utility businesses;
(4) The Trust Indenture Act of 1939, codified at 15 U.S.C. 77aaa et seq., governing debt
securities;
(5) The Investment Company Act of 1939, codified at 15 U.S.C. 80a-1 et seq., regulating
companies whose primary business is owning or trading securities; and
(6) The Investment Advisers Act of 1940, codified at 15 U.S.C. 80b-1, et seq., regulating
investment advisers. 7
Along with these six regulatory statutes, securities related conduct is also contained in various
criminal statutes, including mail and wire fraud statutes8
, criminal RICO9
, conspiracy and aiding
and abetting liability10
, obstruction of justice, and perjury and false statements statutes11
.
6
The Supreme Court, in Marine Bank v. Weaver, 455 U.S. 551, (1982), construing the virtually identical definition
of “security” under the Securities Exchange Act of 1934, the definition is “quite broad” and meant to include “the
many types of instruments that in our commercial world fall within the ordinary concept of a security,” including
“stocks and bonds, along with the countless and variable schemes devised by those who seek the use of the money
of others on the promise of profits.” Weaver, 455 U.S. at 555.
7
3-56 Criminal Defense Techniques, §56.02, p. 1
8
18 USC 1348, the securities and commodities fraud statute, makes it a crime for anyone who knowingly executes,
or attempts to execute, a scheme or artifice
to defraud any person in connection with any commodity for future delivery, or any option on a commodity
for future delivery, or any security of an issuer with a class of securities that is registered under section 12
of the Securities Exchange Act of 1934 (15 USC 78l) or that is required to file reports under section 15(d)
of the Securities Exchange Act of 1934 (15 USC 78o(d)) OR by means of false or fraudulent pretenses,
3. III. Criminal Penalties under 1933 and 1934 Acts
There has been a sharp increase in criminal enforcement, especially with respect to
insider trading cases, since the late seventies.12
Federal prosecutions are frequently derived from
SEC enforcement actions, which should be a cautionary note to defense attorneys. An SEC
investigation will likely result in criminal prosecution, with potential fines, as well as possible
incarceration.13
Each violation of the 1934 Act results in various penalties,14
therefore, it is wise
for the criminal defense attorney to understand each section of the 1933 and 1934 Acts before
undertaking the defense of a client charged with a securities fraud violation. The majority of
representations, or promises, any money or property in connection with the purchase or sale of any
commodity for future delivery, or any security of an issuer with a class of securities registered under
section 12 of the Securities Exchange Act of 1934 (15 USC 78l) or that is required to file reports under
section 15(d) of the Securities Exchange Act of 1934 (15 USC 78o(d)). 18 U.S.C. 1348.
Provisions of 18 USC 1348 were modeled on provisions of mail and wire fraud statutes as set forth in 18
USC 341 and 343; therefore, courts have held that the government was required to shore some intent to harm
victims. United States v. Motz, 632 F. Supp. 2d 284.
9
3-56 Criminal Defense Techniques § 56.02, 18 U.S.C. § 1961(1)(D); 18 U.S.C. § 1961(1)(B)
10
Id., 18 U.S.C. § 2, however, there is a commonly used defense technique when defendants are charged with aiding
and abetting securities fraud. Defense attorneys commonly argue (1) that there was no underlying securities
violation; and (2) that the alleged aider or abettor did not have the requisite knowledge of the infraction. United
States v. Kessi, 868 F. 2d 1097, 1104 (9th Cir. 1989).
11
Id., 18 U.S.C. §§ 1621, 1623; 18 U.S.C. § 1503; 18 U.S.C. § 100. A cautionary note for defense attorneys though;
for the government to charge under a false statements or obstruction of justice statute, the faulty information does
not need to be material in order to violate the statutes, whereas in a securities fraud violation, materiality is an
element of the offense. 3-56 Criminal Defense Techniques § 56.02, citing United States v. Ruggiero, 934 F. 2d 440,
446 (2d Cir. 1991) (likewise, for a defendant to be charged with obstruction of justice, his endeavor to obstruct need
not be successful). 3-56 Criminal Defense Techniques § 56.02, citing United States v. Russell, 255 U.S. 138, 143
(1921). Although indicted with false statements and perjury, Martha Stewart was brought in front of the grand jury
initially as an insider trading witness. United States v. Stewart, 433 F. 3d 273 (2d Cir. 2006).
12
See 4-17 Business Crime P. 17.11, note 2, “these statistics are based on a review of the Annual Securities and
Exchange Commission Reports to Congress, for the years of 1982 through 1997.”
13
Note the recent case gaining national recognition, United States v. Rajaratnam, 2011 U.S. Dist. LEXIS 91365
(S.D.N.Y. Aug. 11, 2011). In May 2011, Mr. Rajaratnam, head fund manager and founder of Galleon Group, was
found guilty of five counts of conspiracy to commit securities fraud and nine counts of securities fraud after the SEC
initiated an investigation. Mr. Rajaratnam recently attempted to renew his motion for acquittal, however, his motion
was denied, in its entirety, as the court held that the government presented sufficient evidence that Mr. Rajaratnam
agreed to trade on the basis of inside information he had received from several sources.
14
Business Crime, 17.14, Criminal Penalties under the 1933 and 1934 Acts, p 1
4. criminal prosecutions come under Section 17(a) of the Securities Act of 193315
, Section 10(b) of
the Securities Exchange Act of 193416
, and Rule 10b-517
. Although complex, prosecutors only
have to prove that a defendant who violated a securities fraud provision had a general wrongful
purpose, where mail and wire fraud provisions require proof of specific intent.18
While
prosecutors run the risk of confusing juries, charging under these statutes is sometimes preferred
for several reasons. The level of intent required for a securities fraud violation is proof of a
general wrongful purpose, which also includes reckless conduct.19
Additionally, there is an
expansive body of civil case law that interprets the various provisions of the 1933 and 1934 Acts,
which are applicable to criminal litigation.20
IV. Defense Strategies
a. Elements
15
“It shall be unlawful for any person in the offer or sale of any securities by the use of any means or instruments of
transportation or communication in interstate commerce or by the use of mails, directly or indirectly,
(1) To employ any device, scheme, or artifice to defraud, or
(2) To obtain money or property by means of any untrue statement of a material fact or any omission to
state a material fact necessary in order to make the statements made, in the light of the circumstances
under which they were made, not misleading, or
(3) To engage in any transaction, practice or course of business which operates or would operate as a fraud
or deceit upon the purchaser.”
15 U.S.C.§ 77q(a)
16
“It shall be unlawful for any person, directly or indirectly, by the use of any means or instrumentality of interstate
commerce or of the mails, or of any facility of any national securities exchange…
(b) to use or employ, in connection with the purchase or sale of any security registered on a national
securities exchange or any security not so registered, any manipulative or deceptive device or contrivance in
contravention of such rules and regulations as the Commission may prescribe as necessary or appropriate in the
public interest for the protection of investors.”
15 U.S.C. § 78j(b)
17
“It shall be unlawful for any person, directly or indirectly, by the use of any means or instrumentality or interstate
commerce or of the mails, or of any facility of any national securities exchange
(a) To employ any device, scheme, or artifice to defraud,
(b) To make any untrue statement of a material fact or to omit to state a material fact necessary in order to
make statements made, in light of the circumstances under which they are made, not misleading, or
(c) To engage in any act, practice, or course of business which operates or would operate as a fraud or
deceit upon any person, in connection with the purchase or sale of any security.
17 C.F.R. § 240.10b-5
18
United States v. Dixon, 536 F. 2d 1388, 1395 (2d Cir. 1976) (holding that it is sufficient that the defendant realize
he was doing a wrongful act); United States v. Yeager, 521 F. 3d 367, 374 (5th Cir. Tex. 2008) (using insider trading
information in making trades is not an element of securities fraud).
19
Id.
20
4-17 Business Crime P 17.11, p2; see e.g. United States v. Charnay, 537 F.2d 341, 348 (9th Cir. 1976).
5. For a prosecutor to prove his or her case under the three statutes, the prosecutor has to
show (1) that there was substantial fraudulent activity21
, (2) involving the offer, purchase or sale
of securities (3) by use of interstate commerce or the mails.
b. Strategies
It is important to understand what law your client is being charged with having
violated. The most common defense strategy has been to focus on the relative complexity of the
securities laws and portray misconduct as a technical violation, committed without fraudulent
design or intent.22
However, it is common for prosecutors to come back at this defense,
depicting the defendant as a clever, sophisticated crook.23
The defendant’s wrongful conduct
consisted of solely administrative tasks, such as executing unsolicited orders or other routine
brokerage services, which do not amount to substantial assistance, as required by the statute. 24
In United States v. Lucarelli25
, the defendant was entitled to judgment of acquittal as to
convictions of securities fraud based on scheme to illegally obtain shares of bank during its
conversion to charged capital stock savings bank, because jury’s answer to special interrogatory
found that the defendant did not have the specific intent to defraud, which was a necessary
element of this crime.
Another commonly used defense, although challenging, is the reliance of advice of
counsel defense. A defendant may assert that he or she relied on the advice of counsel in
concluding that she or he was either not selling securities, or that, if he or she was, he or she was
21
Inclusive of one of the three types of fraudulent activity listed in Section 17(a) of the Securities Act of 1933,
Section 10(b) of the Securities Exchange Act of 1934, or Rule 10b-5, and this misrepresentation or fraud must be
material. The materiality of a misrepresentation “is judged by its potential effect on the decision its recipient makes
about his or her securities transactions.” 4-17 Business Crime P 17.11, p 3.
22
3-56 Criminal Defense Techniques 56.02, p 7
23
Id.
24
United States v. Kessi, 868 F. 2d 1097, 1104 (9th Cir. 1989)
25
490 F. Supp. 2d 295 (D. Conn. 2007)
6. not required to register these securities.26
However, where a client was not truthful and
comprehensive in his or her disclosure to counsel, this defense is not available.27
Unlike many other criminal statutes, defense attorneys in securities fraud allegations may
assert that the defendant was ignorant of the law. However, this defense may not always be
successful. In United States v. Wolfson28
, the defendant, the largest shareholder in the
corporation, exercising dominant control over the corporation’s operations and policies, asserted
that he was too preoccupied with the larger affairs of his business to focus on technical
requirements, and that he left it to his brokers to bring requirements to his attention. Mr.
Wolfson was found guilty, and the Court of Appeals stated that “the jury rejected this defense, if
indeed it is any defense at all.”29
A defendant may also assert a defense of compliance with professional standards. It is
argued that this compliance takes account of the professionals’ conflicting duties to both their
clients and the public that only professional rules can properly resolve and ought to constitute a
total defense to criminal prosecution under the Securities Acts of 1933 and 1934.30
Again, this
defense does not always hold up. In United States v. Simon,31
the court held that while evidence
of private rules govern a profession are admissible in rebutting criminal intent, proof of
compliance with these rules does not necessarily constitute a defense.
26
4-17 Business Crime P 17.11, p17
27
Id., United States v. United Med. And Surgical Supply Corp., 989 F. 2d 1390, 1403-1404 (4th Cir. 1993); SEC v.
McNamee, 481 F. 3d 451, 456 (7th Cir. 2007).
28
Id., see also 405 F. 2d 779 (2d Cir. 1968).
29
Id., at 782.
30
4-17 Business Crime P 17.11, p22
31
Id., see also United States v. Simon, 425 F. 2d 796 (2d Cir. 1969).
7. V. Conclusion
Although securities laws are complex, they are not impossible to master. Defense
attorneys should spend significant time navigating the law before they contemplate actual
defenses, and must do research to determine which circuits are most favorable to particular
defenses.