Court Quashes Incremental Insider-Trading Appeals

Jul 1 2013 | 12:24pm ET

For the second time in as many weeks, a federal appeals court has refused to throw out a hedge-fund insider-trading conviction.

The Second Circuit Court of Appeals in Manhattan rejected the appeals of Zvi Goffer, Craig Drimal and Michael Kimelman. The three were convicted in 2011 of participating in one of two interlocking insider-trading rings in the Galleon Group case; both Goffer and Drimal, the latter of whom pleaded guilty in the case, were former Galleon employees.

Last week, the Second Circuit upheld the conviction of Galleon founder Raj Rajaratnam, who is serving an 11-year prison sentence.

While the court upheld all three convictions and sentences, including Goffer’s 10-year term, it ordered that the order of forfeiture against Goffer be recalculated.

Drimal was sentenced to five-and-a-half years in prison and Kimelman, who worked with Goffer and Goffer’s brother, Emmanuel, who was also convicted, at hedge fund Incremental Capital, to two-and-a-half years. Kimelman had rejected a no-bail plea deal before the trial.

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