This afternoon, here in Manhattan, a jury found former SAC Capital portfolio manager Mathew Martoma guilty of insider trading. The verdict wasn’t a shock, given the strong evidence against Martoma and the fact that another former SAC trader, Michael Steinberg, got convicted in December on weaker evidence.
The trial involved a number of boldface names of the legal profession. The office of U.S. Attorney Preet Bharara (S.D.N.Y.), one of our 2013 Lawyer of the Year nominees, was represented by assistant U.S. attorney Arlo Devlin-Brown, one of the office’s most prominent prosecutors (and a star of the college debate circuit, for those of you who used to do debate). Martoma was defended by a team from Goodwin Procter that included Richard Strassberg, an S.D.N.Y. alumnus, and Roberto Braceras, another former federal prosecutor — and the son-in-law of Judge José Cabranes. The prosecution’s lead witness, Dr. Sidney Gilman, was represented by Bracewell & Giuliani’s Marc L. Mukasey — son of former S.D.N.Y. judge and U.S. Attorney General Michael Mukasey.
And some of our readers might know Mathew Martoma. He was a student at Harvard Law School back in the 90s, before he got expelled for fabricating his transcript while applying for clerkships.
Here are some notable numbers relating to the Mathew Martoma mess:
- The profits made and losses avoided by SAC Capital as a result of Martoma’s insider trading: $275 million.
- The win/loss record of U.S. Attorney Preet Bharara and the S.D.N.Y. in insider-trading cases: 79-0.
- How long the Mathew Martoma trial lasted: 4+ weeks.
- How long the jury deliberated: 15 hours.
- Gender breakdown of the jury: 7 women, 5 men.
- Counts of conviction: 2 counts of securities fraud, 1 count of conspiracy.
- Penalties paid by SAC Capital back in November 2013: $1.2 billion.
- Current or former employees of SAC Capital (including Martoma) who have been convicted of criminal insider-trading charges (whether by guilty plea or trial): 8.
- Number of “A” grades on Mathew Martoma’s fake Harvard Law School transcript: 4 (out of 7 grades).
- Number of D.C. Circuit judges that Martoma got clerkship interviews with: 3.
- Age of Mathew Martoma: 39.
- How many young children Martoma has: 3.
- The length of Martoma’s likely prison sentence (pursuant to the non-binding federal sentencing guidelines): 7-10 years.
Moral of the story: don’t engage in insider trading. Getting a $9 million bonus sounds great, but you don’t get to keep the money after you get convicted — plus you might have to spend a decade behind bars.
P.S. I do wonder whether Steve Cohen of SAC Capital will help out Mrs. Martoma and the couple’s three kids while Mathew Martoma is in prison, considering that he refused to cooperate with the federal investigation of Cohen and SAC — and will now pay a high price for loyalty to his former boss.
Jury: Mathew Martoma’s Trades Of The Insider Variety [Dealbreaker]
Former SAC Manager Mathew Martoma Found Guilty in Insider Case [Wall Street Journal (sub. req.)]
Ex-SAC Portfolio Manager Convicted of Insider Trading [DealBook / New York Times]