internet privacy finance is-x-legal insider-trading
Is internet tracking &quot;public info&quot; for insider trading purposes?
<p>Suppose I own a search engine. I look at my server logs and see that the query "how to fix exploding engine" is very popular in the area around Tesla headquarters. Would it be legal to act on this information and short Tesla? What if I had purchased this info from a public data broker instead?</p>

<p>This is not insider information. Inside information is information received from the Company or an employee or agent of the company that has not been publicly disclosed. So, it does not violate federal insider trading laws.</p>

<p>It is conceivable that the search engine operator might have a contractual duty to to the company, for example, a non-disclosure agreement in an agreement for that company to advertise through the website. Likewise, there might be a privacy policy vis-a-vis customers saying what their searches would and would not be used for doing, which this use could conceivably violate.</p>

<p>But, in general, the use of this data is not a securities fraud violation, and I know of no other regulations of search engine operators or other businesses that obtain generalized information from customers that would prohibit the use of information like this to trade publicly held securities.</p>

<p>This is no different from counting the number of cars in a parking lot of a certain retailer (to estimate their projected revenue).  As long as this information is already public, the fact that there aren't any public sources of the aggregate data about the information does not change the fact that the information is already public.</p>

<p>Although, once produced, the aggregate data maybe copyright the entity which produced it.  This has come up, in at least one, lawsuit involving LexisNexis.</p>
