On the surface, it looks like we are drowning in information from companies and major shareholders. But the surprising accumulation by two hedge funds of a 21 percent stake in CNET (NSDQ: CNET)—and the company’s decision not to go public until it was leaked—shows how superficial our knowledge can be. (For me, CNET’s initial silence was a repeat of the Dow Jones (NYSE: NWS) board’s decision to keep other shareholders in the dark about Rupert Murdoch’s offer until it, too, was leaked.) Andrew Ross Sorkin explains the loophole that allowed Jana Partners and Sandell Asset Management to acquire just more than one-fifth of CNET despite Reg 13D (must disclose stakes of 5 percent or more) and the Hart-Scott-Rodino Act (activist disclosure after investing more than roughly $60 million):  the ability to have investment banks acquire the shares for the funds but never transfer full ownership. “What today’s clever investors have noticed is that the law requires them to disclose only when they control more than 5 percent of the vote, not 5 percent of the economics in a company. So hedge funds use ‘swaps’ to buy shares and — technically at least — strip out the voting power that comes with them.”

SEE ALSO: Updated: CNET Details Its Poison Pill; Acquirer Threatened With ‘Substantial Dilution’

It is beyond convoluted—and legal.