In the case of O'Hagan v. United States, the Supreme Court addressed insider trading laws. The case involved James O'Hagan, who used confidential information from his law firm to buy stock in a company that was about to be acquired. He profited significantly from these trades, leading to charges of securities fraud. The Court ruled that O'Hagan's actions violated the Securities Exchange Act of 1934. The decision clarified that individuals can be prosecuted for insider trading even if they do not directly owe a duty to the shareholders of the company involved. This case reinforced the legal framework surrounding insider trading.