18. What tort violation, if any, did Michael commit when he sold the devalued stock to Freda?

SOURCES

MICHAEL

Michael was notified by the Executive assistant of JCI's president that a scandal about the company would break in the news in days to come. She said that the scandal would negatively impact stock value of JCI. In fact, Michael was informed that all of the top executives were cashing in their stock so as not to lose the life's savings. One of the top executives suggested strongly that Michael sell his stock while it still had value. Michael gave it some thought for a few days and told his broker to "sell it all". He recognized a handsome profit. After cashing in his stock he admitted that he would not have cashed it in if it were not for the executives giving him the warning and basically insisting that he sell. The day after the sale of Michael's stock the value of JCI dropped more than 75%. Most of their investors lost 100% of their investments. Michael's broker inadvertently sold 75% of his stock instead of the entire 100% that Michael requested. Michael knew a wealthy older woman who had no knowledge of the devalued stock and offered to sell her his shares at a bargain price of $100 per share the next day. The stock 4 had already nose-dived and the stock that he was selling to the woman had no actual value at all. She purchased 1250 shares at a rate of $100 a share for total of $125,000.00. The woman asked him 3 times if the sock was profitable stock and he assured her it was. Five days after Michael sold his stock, the SEC visited him at JCI. The SEC took Michael into the back office for an interrogation. Michael insisted that he want to call his lawyer buy the Federal Officers just continued their questioning. After refusing to answer any questions they took him to lead him to the police car and took him to the county jail. At no time did they read him is Maranda rights. Upon arrival at the station they continue to refuse Michael's request to call his attorney. Additionally, he was not specifically told what he was being charged with and he was held in a holding cell for 80 days. His holding cell did not heat and temperatures fell to as low as 10 below zero in the cell he was kept in. On the 81 first day Michael was taken before a judge and gave his plea of Nolo Contendere.