Jiau's Tips Not 'Material,' Lawyer Says

Jun 2 2011 | 1:40pm ET

The lawyer for accused insider-trader Winifred Jiau will tell jurors that her client may have passed confidential information, but didn't violate the law.

Joanna Hendon yesterday told U.S. District Judge Jed Rakoff that she would stipulate that Jian had both worked as an expert networker and that she provided information to hedge fund clients. But, Hendon said, that would hardly be a guilty plea.

"Sure, she got the information, sure she is paid thousands of dollars, it was non-public, sometimes, not always," Hendon said. "She was happy to get it to her sources, she is happy to make hedge funds happy, but at the end of the day, the information she had was not material to any trades."

"There are so many professionals out there that have earnings information that there is an argument out there about whether any fiduciary duty was ever breached," she added.

Hendon and prosecutors will present their opening statements to the jury in the case today. A panel of nine women and three men were seated yesterday to decide Jiau's fate; she faces up to 25 years in prison if convicted.

According to prosecutors, Jiau, a former consultant with Primary Global Research, is accused of passing tips about two companies to two hedge fund managers. Eight people have pleaded guilty in the case, several of them implicating Jiau.

Jiau, who has been in custody since her arrest in December, wore a suit to court, rather than prison garb, after Rakoff gave her access to three blouses, two suits and a pair of shoes on Monday.

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