Longueuil, Jiau Seek Dismissal Of Insider-Trading Charges

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.


In Depth

Fundraising for Mid-Sized PE Funds: Should You Use a Registered B/D?

Dec 6 2016 | 7:18pm ET

When does a fund sponsor need to use a registered broker/dealer when raising capital...

Lifestyle

Trump Attends 'Villains and Heroes' Costume Party Dressed As...Himself

Dec 5 2016 | 11:16pm ET

U.S. President-elect Donald Trump attended a "Villains and Heroes" costume party...

Guest Contributor

A Hard Look At Your ‘Soft’ Hedge Fund Marketing Information

Dec 8 2016 | 9:03pm ET

Conventional wisdom holds that due diligence examines quantitative as well as qualitative...

 

From the current issue of

Since the inception of Modern Trader, a core editorial theme has centered on the wisdom and power of crowds. Editorial emphasis has focused on companies and projects engaged in the collection and analysis of information. 

AVAILABLE NOW at BARNES & NOBLE

NEWSTAND LOCATOR