SAC's Steinberg Lawyer Wants New Judge

Apr 4 2013 | 12:42am ET

SAC Capital Advisors portfolio manager Michael Steinberg's lawyer has begun his client's defense against insider-trading charges by potentially antagonizing the judge who could decide Steinberg's fate.

At Steinberg's Friday arraignment, Barry Berke asked U.S. District Judge Richard Sullivan to step aside and allow the case to be randomly assigned to a new judge. Berke alleged that Sullivan was too easy on prosecutors in a past insider-trading case compared to two other judges on the Manhattan federal bench.

Sullivan was assigned the case because it is related to that against Level Global Investors co-founder Anthony Chiasson and former Diamondback Capital Management portfolio manager Todd Newman, whose trial he oversaw last year. The two were indicted alongside Steinberg's former analyst, Jon Horvath, who is cooperating with prosecutors, and are listed as co-conspirators in the case against Steinberg.

Chiasson and Newman were convicted in December.

Berke noted that Sullivan did not require prosecutors to show that Chiasson and Newman knew about the personal benefits their tippers received, as his colleagues Jed Rakoff and Richard Holwell did in other cases. Berke called it a "significant legal issue."

Sullivan said he would "consider" Berke's request, but assured Steinberg that even if he rejected it, he would be an impartial arbiter.

"Don't believe Mr. Berke, I'm not as bad as he says," Sullivan said. "If you get stuck with me, it could be worse."

According to Reuters, from Steinberg's perspective, he might be as bad: Court records show Sullivan has handed down harsher sentences than his colleagues in insider-trading cases.


In Depth

An Interview With Harvest Volatility Management's Rick Selvala

Mar 23 2017 | 5:39pm ET

Several years of extremely low interest rates have pushed some investors into equities...

Lifestyle

'Tis the Season: Wall Street Holiday Parties Back In Fashion

Dec 22 2016 | 9:23pm ET

Spending on Wall Street holiday parties has largely returned to pre-2008 levels...

Guest Contributor

SEI: Private Debt Coming Into Its Own

Mar 8 2017 | 9:24pm ET

The explosive growth of private debt over the past few years has caused the lines...

 

From the current issue of