File photo of Rajat Kumar Gupta captured during the session \u2018Will India Meet Global Expectations?\u2019 at the Congress Center at the Annual Meeting 2010 of the World Economic Forum in Davos, Switzerland, January 28, 2010. (Sebastian Derungs\/World Economic Forum\/Swiss-image.ch)<\/p>\n
Former Goldman Sachs director Rajat Gupta, who is arguing in appeal that the government lacked evidence to show he \u201creceived even a penny\u201d for passing insider information, has disagreed with a U.S. Supreme Court ruling that sharing corporate secrets is illegal even if the tipsters did not receive anything in return, writes Yoshita Singh. <\/b>#siliconeer @siliconeer #rajatgupta #insidertrading #goldmansachs #McKinsey #IIT #Harvard<\/p>\n
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In a landmark ruling earlier this month relating to the insider trading conviction of Illinois resident Bassam Yacoub Salman, the Supreme Court unanimously ruled that sharing corporate secrets with friends or relatives is illegal even if the insider providing the tip doesn\u2019t receive anything of value in return.<\/p>\n
68-year-old Gupta is a free man now after completing a prison term on insider trading charges but is not giving up his legal battle to overturn his conviction, arguing that he served two years in jail for conduct that is not criminal even though the government lacked evidence to show he \u201creceived even a penny\u201d for passing confidential boardroom information to now jailed hedge-fund manager Raj Rajaratnam.<\/p>\n
In May, Gupta\u2019s team of lawyers had argued in papers before the Second Circuit Court of Appeals that the judgment of the Manhattan district court finding Gupta guilty of insider trading \u201cshould be reversed\u201d and his \u201cconviction should be vacated.\u201d<\/p>\n
Gupta\u2019s appeal comes on the back of a ruling by the Manhattan appeals court that for an insider trading conviction prosecutors must show that a defendant received a personal benefit for passing illegal tips. Gupta\u2019s lawyers have cited the ruling that led to the reversal of insider convictions of hedge-fund managers Todd Newman and Anthony Chiasson in December, 2014.<\/p>\n
In fresh court papers following the verdict in Salman\u2019s case, Gupta said there is \u201ca fatal inconsistency\u201d and he was \u201csubstantially prejudiced by the invalid theory of benefit pursued at trial; and that his entitlement to relief is in no way affected\u201d by the verdict in the Salman case.<\/p>\n
\u201cThe issue on this appeal is whether the government\u2019s benefit theory (that Gupta tipped to maintain a good relationship with Rajaratnam), and the district court\u2019s instruction that the benefit could be modest, intangible and non-financial, are fatally inconsistent with Newman\u2019s quid pro quo requirement: an exchange of a tip for a benefit that is \u2018objective, consequential, and at least potentially pecuniary\u2019,\u201d Gupta\u2019s lawyers said in court papers.<\/p>\n
The government said Gupta\u2019s appeal lacked merit even under the Newman ruling and the Salman verdict \u201cconfirms the validity of the District Court\u2019s jury instructions and thus defeats Gupta\u2019s claim of error at the outset.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
File photo of Rajat Kumar Gupta captured during the session \u2018Will India Meet Global Expectations?\u2019 at the Congress Center at the Annual Meeting 2010 of the World Economic Forum in Davos, Switzerland, January 28, 2010. (Sebastian Derungs\/World Economic Forum\/Swiss-image.ch) Former Goldman Sachs director Rajat Gupta, who is arguing in appeal that the government lacked evidence…<\/p>\n