Fleishman's Lawyer Says Client Couldn't Know What Was Inside, What Was Not

Sep 20 2011 | 2:07pm ET

The lawyers on either side of the expert-network insider-trading case against a former Primary Global Research salesman made their final pitches to the jury that will decide his fate yesterday.

Prosecutors, in their closing argument, said James Fleishman was well aware of the fact that he was putting money managers, including hedge fund managers, in touch with industry players for the purpose of the former's getting confidential corporate information. But Fleishman's defense lawyer countered that there was no way that a mere salesman could know what was material, non-public information, and what wasn't.

"He knew confidential information was being passed repeatedly to members of the investment community," Assistant U.S. Attorney David Leibowitz said. "He not only knew it. He helped make it happen."

What's more, Fleishman knew "that certain consultants were violating the law and passing important confidential information, but they didn't care and let it happen because it was the lifeblood of their business."

Fleishman "did not agree with anybody to steal information," the defendant's lawyer, Ethan Balogh, retorted. "He did not intend that any PGR consultant would violate their agreement with their employer to not provide confidential information."

What's more, Fleishman was not in a position to know what was an illegal tip from "a handful of rogue experts" and what wasn't.

"He was an honest salesman doing his job," Balogh said.

Fleishman is one of 15 people arrested in the case. To date, 12 have pleaded guilty and one has been convicted by a jury. If Fleishman beats the conspiracy charges, which carry a prison sentence of up to 25 years, he'll be the first to escape a conviction in the case.

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