Thursday, 23 February 2017
Last updated 11 hours ago
Apr 12 2011 | 4:56am ET
Two of the 12 people charged in the Justice Dept.’s massive insider-trading case asked a judge to dismiss the cases against them.
Former SAC Capital Advisors fund manager Donald Longueuil and former “expert network” consultant Winifred Jiau claimed in separate filings that prosecutors have failed to present sufficient evidence to support the insider-trading charges. Both have pleaded not guilty.
“The indictment fails to allege Mr. Longueuil know or should have known that material non-public information he received from non-inside sources was originally obtained from an inside tipper that fraudulently breached a duty,” Craig Carpenito, a lawyer for Longueuil, wrote. “Mr. Longueuil was a third tier recipient of the information at best.”
Prosecutors allege that Longueuil received the tips from another former SAC manager, Noah Freeman, who allegedly got the information from Jiau. Freeman has pleaded guilty and is cooperating with the investigation.
But Carpenito said that prosecutors haven’t shown that Jiau’s alleged tippers broke any fiduciary duty.
Jiau’s dismissal bid claims that there is no evidence that insiders provided her with the tips about Marvell Technology Group or Nvidia Corp. Jiau was a consultant at expert-network firm Primary Global Research, which employed eight of the dozen people arrested in the case.
Jiau’s attorneys also complained about the government’s “egregious” acts preventing their client from defending herself, notably her continued incarceration. Jiau has been denied bail as a flight risk.
Her lawyer, Joanna Hendon, wrote that prosecutors have “tens of millions of pages of documents” among the evidence against her, but she can’t review it from jail. She wants the government to specify which documents are relevant in the case.
Both Jiau and Longueuil face up to 25 years in prison if convicted.
The two also have a plan B, of sorts, should U.S. District Judge Jed Rakoff reject their dismissal requests: They want separate trials.