In an opinion written by Justice Ruth Bader Ginsburg, the Court held that an individual may be found liable for violating Rule 10(b)-5 by misappropriating confidential information.

[1] The Court also held that the Securities and Exchange Commission did not exceed its rulemaking authority when it adopted Rule 14e-3(a), "which proscribes trading on undisclosed information in the tender offer setting, even in the absence of a duty to disclose".

[3] In October, Grand Met announced the takeover bid and the price of Pillsbury stock rose to $60 per share.

[5][needs update] Because O'Hagan was not directly involved in the proposed takeover, he was not obliged by SEC rules to refrain from trading Pillsbury's stock or to disclose his transactions.

Though it didn't find O'Hagan in violation of SEC rules regarding trading by company insiders – known as the "classical doctrine theory" – the Supreme Court adopted an additional doctrine, the "misappropriation theory" set out by Chief Justice Warren Burger in Chiarella v. United States.