Wednesday, September 20, 2006, 9/20/2006 08:00:00 AM

More on Hedge Funds and Trade Secrets

From the Financial Post of Canada, more on the dispute between hedge fund manager Phillip Goldstein and the SEC concerning Goldstein's attempts to forgo disclosure of his funds' holdings as trade secrets (earlier reported here).

More great quotes from Goldstein: "I'm not a crank. I think I'm like Toto in the Wizard of Oz, I've pulled away the curtain." And "there's nothing here, there's absolutely no reason for this rule."

Also his rationale: "Involuntary compliance ... by requiring the Applicants to publicly disclose their trade secrets, [would] constitute a 'taking' of their property without just compensation in violation of the Fifth Amendment to the Constitution." Thus, "[a]n exemption from the filing requirement . necessary to avoid such a violation."

The article also contains some interesting information about the different rules governing such disclosure in Canada where all public funds (and only public funds) -- irrespective of size -- have to disclose their top 25 stock holdings every quarter. Private funds disclose twice a year, but only to their investors without putting their information on the Internet.

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