In that decision, United States v. Newman, the Second Circuit overturned the convictions of two hedge fund managers who received the information from other investors and never dealt directly with the insiders providing the disclosures. The court held that the benefit to the tipper must involve an exchange of something of pecuniary value — like money or property — and that it was not enough to show just “the mere fact of a friendship, particularly of a casual or social nature.”

The personal relationship requirement would have made proving a benefit in insider trading cases more difficult because it required showing more than a casual friendship between the source and the recipient of confidential information.

The Supreme Court declined to review the Newman decision, but in the United States v. Salman, it rejected one aspect of the appeals court’s ruling. It stated the benefit need not involve something of pecuniary value. The Supreme Court, however, did not address the “meaningfully close personal relationship” requirement outlined by the Second Circuit. That left its status as an element to prove insider trading unclear and complicated figuring out what was left of the Newman decision.

The first time the Second Circuit reviewed Mr. Martoma’s case in August 2017, two appeals court judges ruled that the Supreme Court had effectively overturned the entirety of the Newman opinion, so the “meaningfully close personal relationship” requirement was gone. A vigorous dissent from the third judge in the case pointed out that the Salman decision never mentioned this requirement and argued that the majority had overreached in their decision.

Two months ago, the appeals court judges revised that opinion. They pulled back from claiming the Supreme Court had scuttled the Newman ruling in its entirety and held that the “meaningfully close personal relationship” requirement was merely one way of proving the benefit to a tipper. An intent to benefit the recipient of the information, known as the “tippee,” was enough to prove insider trading. The appeals court went so far as to say that giving information to a “perfect stranger” by saying “you can make a lot of money trading on this” would be enough to hold the tipper liable. That’s a far cry from any meaningful personal relationship.

The revised Martoma decision means the government needs to prove only that Mr. Collins intended to benefit his son, who in turn sought to help Mr. Zarsky, the fiancée’s father, by passing on the information.

The Collins indictment indicates that the case will be circumstantial, built around the timing of a series of telephone calls the congressman made to his son while he was attending a picnic at the White House.