SAC Sued By Drug Co. Investors In Insider-Trading Case

Apr 15 2013 | 11:31am ET

An investor in one of the drug companies whose shares were allegedly traded illegally by SAC Capital Advisors has sued the hedge fund.

The Birmingham Retirement & Relief System suit, filed in Manhattan federal court on Friday, seeks class-action status, alleging that SAC's trades hurt Wyeth LLC's shares. BR&RS is an investor in the pharmaceutical company.

Former SAC portfolio manager Mathew Martoma has been accused of trading on confidential information about a Wyeth and Elan Corp. Alzheimer's drug trial, saving SAC some $276 million. Martoma has pleaded not guilty, but SAC has agreed to settle Securities and Exchange Commission allegations about his actions for $606 million—a deal that has been put on hold by a federal judge.

SAC would not admit or deny wrongdoing under that settlement.

The BR&RS lawsuit would cover all investors who bought Wyeth shares between July 21 and 29, 2008. It also names SAC founder Steven Cohen, several SAC units, Martoma and Martoma's alleged source, Sidney Gilman. Gilman has pleaded guilty and is cooperating with prosecutors.

"Any liability to these plaintiffs is fully discharged by our settlement with the SEC, and this lawsuit presents no new liability to SAC," a spokesman for the hedge fund said.

The lawsuit is the second would-be class action over Martoma's trades to hit SAC: In January, six Elan shareholders sued the hedge fund.


In Depth

Q&A: Pantheon’s McCrary Says Private Equity Market ‘Robust’

Dec 17 2014 | 8:32am ET

Dennis McCrary is a partner at Pantheon, a private equity firm with $32.2 billion...

Lifestyle

Cohen Donates $1.5M To GOP Governors Association

Dec 10 2014 | 7:13am ET

The Republican Governors Association raised close to $25 million from October 1...

Guest Contributor

Q&A With Daniel Gallancy: Institutional Interest In Bitcoin Is Growing Steadily

Dec 12 2014 | 7:54am ET

Daniel Gallancy is founder and CEO of SolidX, a provider of total return swaps for...

 

Sponsored Content

Editor's Note

    Guidelines for Guest Articles

    Oct 22 2014 | 9:46am ET

    We are always looking for guest articles from hedge fund managers and buy-side firms.

    If you are interested in submitting a contributed piece for possible publication on FINalternatives, please take a look at the specs. Read more…

 

Futures Magazine

December 2014 Cover

Futures 2014 person of the year

Jeff Sprecher was simply looking for a platform to trade energies when launching ICE 14 years ago but it has grown to reach the pinnacle of both the listed futures and equities world.

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.