Friday, 5 February 2016
Last updated 4 min ago
Oct 2 2013 | 10:28am ET
Two months after losing at trial, former Goldman Sachs executive Fabrice Tourre wants a new one.
Better yet, he'd like to have the civil fraud charges against him thrown out entirely, his lawyers wrote in a Monday court filing. Tourre was found liable by a jury in August for misleading investors in a Paulson & Co.-linked collateralized debt obligation.
Tourre's lawyers argued that he received no compensation as a result of the allegedly misleading statements, and that the Securities and Exchange Commission failed to show that the CDO, ABACUS-AC1-2007, was a "domestic offer."
"The libaility verdicts on the other counts are so contrary to the weight of the evidence that it would work a manifest injustice to Mr. Tourre if they were permitted to stand," Tourre's lawyers wrote. They noted that the jury "incorrectly concluded" that Tourre's base salary at Goldman was enough to fulfill the requirement that he be compensated for lying, and that the evidence shows that "his bonus was likely lower" because Goldman lost money on part of the CDO.
The SEC has until the end of the month to respond to the motion. The judge in the case has not yet ruled on what sanctions Tourre will face as a result of the verdict.
The SEC alleged that Tourre deliberately misled investors and the insurer of the ABACUS CDO about Paulson's role in selecting the securities that went into the deal, and about the hedge fund's plan to short it. Paulson has not been accused of any wrongdoing in the case.