Goldman Investor Fights Gupta Dismissal Bid

Dec 9 2011 | 10:02am ET

The Goldman Sachs investor suing former McKinsey & Co. chief Rajat Gupta for his alleged passing of confidential information to hedge fund manager Raj Rajaratnam is fighting Gupta's effort to have the case dismissed.

Gupta, who is also facing criminal charges and a Securities and Exchange Commission lawsuit stemming from the Galleon Group scandal, argued that James Mercer's suit should be junked because Gupta did not benefit financially from Rajaratnam's trades. But Mercer contends that, as a Goldman Sachs shareholder, Gupta did profit

"Gupta did not provide confidential information about the Goldman Sachs Group Inc. to Raj Rajaratnam without purpose," Mercer's filing yesterday alleged. "He did it for pecuniary gain."

According to Mercer, the SEC and prosecutors, Gupta, who served on Goldman's board, alerted Rajaratnam to an impending investment by Berkshire Hathaway in the bank. He also allegedly gave Rajarantnam advance notice about a surprise loss posted by the bank.

Goldman CEO Lloyd Blankfein testified at Rajaratnam's trial that the information passed by Gupta was confidential and that Gupta had violated Goldman's policies. Rajaratnam was convicted and sentenced to 11 years in prison.


In Depth

GSAM's Papagiannis: Liquid Alternatives For The Long Run

Apr 21 2017 | 8:44pm ET

Interest in liquid alternatives cooled a bit last year amid a broad shift in investor...

Lifestyle

Aston Martin Returns To Debt Market As DB11 Drives Turnaround

Mar 31 2017 | 5:21pm ET

James Bond’s preferred carmaker is returning to the public debt markets for the...

Guest Contributor

Debunking Conventional Investment Wisdom (Part II)

Apr 17 2017 | 5:56pm ET

The alternative investment industry is currently replete with buzzwords around data...

 

From the current issue of