Friday, 30 January 2015
Last updated 18 min ago
Jan 30 2014 | 2:36pm ET
A former analyst at Tokum Capital Management told the jury in the Mathew Martoma insider-trading case that he, too, received detailed information about drug trials from Martoma's alleged source.
That source, Sidney Gilman, testified earlier in the trial that he "systematically" shared information about an Alzheimer's drug trial he was overseeing with Martoma. But the former SAC Capital Advisors portfolio manager's lawyers should the jury notes Rene Shen took during a conversation with Gilman in 2008, at around the same time Gilman is said to have tipped Martoma about discouraging results. Shen's notes appear to include information that prosecutors have said, in Martoma's case, was confidential.
Martoma's defense team also question two of their client's former colleagues at SAC. General Counsel Peter Nussbaum completed his testimony, begun on Tuesday, telling the jury that the period of the allegedly illegal trades was one of "extreme anxiety" in the markets, and featured a temporary ban on naked short selling. Nussbaum said he discussed that order from the Securities and Exchange Commission with Cohen.
But, under cross examination, Nussbaum said neither he nor his compliance department were notified about the trades in Elan Corp. and Wyeth LLC in question. And he called into question the defense claim that the trades were made on the recommendation of a former SAC trader, Wayne Holman.
Nussbaum had testified on Tuesday that Holman was under contract to advise Cohen about Wyeth. But he said Holman hadn't been paid for the trades in question, because it was a "losing position."
Another former college, Chandler Bocklage, testified that Cohen regularly consulted with others about healthcare stocks, in addition to Martoma. Bocklage is one of Cohen's closest colleagues at SAC, sitting next to the billionaire for more than a decade, assisting with SAC's so-called Cohen account, which featured the firm's best ideas as vetted by Cohen himself. Bocklage himself said he was Cohen's "right hand man."
But even Bocklage didn't know about the Elan and Wyeth trades, he said. "I was told after the fact that we weren't involved anymore." Bocklage said he thought Cohen told him, "but I'm not sure." Normally, he told the jury, he would have been aware of any trades in the Cohen account, but said he could understand why Cohen wanted to keep it quiet, to hide SAC's trade from other firms.
"I personally think Steve is the greatest trader of all time," Bocklage offered.
Jan 23 2015 | 1:00pm ET
In our new section, FINtech Focus, we will profile one of these firms each week. While fintech is a broad category, we will be focusing on firms that specifically cater to the alternative investment industry. Read more…