The GameStop Short Squeeze as a Case Study in Business Law Education
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Asian Institute of Research, Journal Publication, Journal Academics, Education Journal, Asian Institute
Asian Institute of Research, Journal Publication, Journal Academics, Education Journal, Asian Institute

Education Quarterly Reviews

ISSN 2621-5799

asia institute of research, journal of education, education journal, education quarterly reviews, education publication, education call for papers
asia institute of research, journal of education, education journal, education quarterly reviews, education publication, education call for papers
asia institute of research, journal of education, education journal, education quarterly reviews, education publication, education call for papers
asia institute of research, journal of education, education journal, education quarterly reviews, education publication, education call for papers
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Published: 30 June 2024

The GameStop Short Squeeze as a Case Study in Business Law Education

Tara Pomparelli

Monmouth University

asia institute of research, journal of education, education journal, education quarterly reviews, education publication, education call for papers
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doi

10.31014/aior.1993.07.02.589

Pages: 199-206

Keywords: Business Law, Class Action, Fiduciary Duty, Financial Regulation, GameStop, Market Manipulation, Payment for Order Flow, Regulations, Retail Investors, Roaring Kitty, Short Squeeze, Social Media

Abstract

This article describes the GameStop short squeeze of January 2021, which was driven by retail investors from the online Reddit forum r/WallStreetBets. The short squeeze resulted in unprecedented market volatility and significant losses for institutional investors like hedge funds, leading to controversial trading restrictions by brokerages like Robinhood. This case study uses the GameStop saga to delve into key legal and ethical issues pertinent to an undergraduate business law class, including market manipulation, regulatory oversight/compliance, and conflicts of interest. It also examines fiduciary duties and class action lawsuits. By exploring these aspects, the study highlights the event's educational value in demonstrating many real-life examples of business law concepts while underscoring the need for robust regulatory frameworks in an era shaped by social media and technological advances.

References

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