The classical theory covers corporate insiders trading against their own shareholders. Misappropriation extends liability to outsiders: a lawyer, printer, consultant, banker or spouse who takes confidential information entrusted to them and trades on it, deceiving the source rather than the counterparty.
The US Supreme Court accepted the theory in United States v. O'Hagan, and it is why advisers to an acquirer can be prosecuted for trading in the target. A rule under the securities-exchange-act-1934 also presumes a duty of trust within family and close personal relationships in defined circumstances.
Disclosure to the source can defeat the theory, which produces the odd result that telling your employer you intend to trade on their secret may remove the deception, though it will still get you fired.
Related: insider-trading, material-non-public-information, tipper-tippee-liability, rule-10b-5