A recent case provided some narrow guidance on an increasingly important issue for private equity and hedge funds: what constitutes a group for Securities and Exchange Commission purposes.

A person beneficially owning 5 percent of a public company must make disclosures on SEC Form 13D within 10 days of reaching the numerical threshold. Recognizing the trigger, however, is increasingly difficult as private equity funds invest with hedge funds in situations traditionally dominated by hedge funds, and vice versa. Interactions and communications with other funds may be construed as acting “in concert,” the talisman for group existence under 13D and treatment as a single “person” for SEC purposes.