Insider Trading

Fire* Thanks to this Government Accountability Office ruling, the company that cleared NSA leaker Edward Snowden and Navy Yard shooter Aaron Alexis may lose a $210M contract. [Legal Times]

* After being acquitted on insider trading charges, Rengan Rajaratnam agreed to settle the civil suit filed against him for a cool $840K. At least he’s not in jail like his brother. [DealBook / New York Times]

* Those interested in going to law school may want to know that Philadelphia is purportedly home to some of the cheapest law schools in the country — not Penn Law, though, sorry ’bout that. [Main Street]

* Professors at WUSTL Law held a “teach-in” to discuss the Michael Brown police shooting case. According to them, the likelihood Darren Wilson will be federally charged is “slim to none.” [Student Life]

* Attack of the aggrieved ex: a man drove a burning pickup truck loaded with explosives into a law firm, destroying much of the building. He had apparently dated one of the firm’s former clients. [Virginian-Pilot]

Insider trading tastes delicious!

* Politics and Biglaw just don’t mix: House Republicans hired Quinn Emanuel to handle their suit against President Barack Obama after Baker Hostetler withdrew from the representation due to “political pressure” the firm was facing. [Politico]

* The paper and napkin-eating “Middleman” in the post-it note insider trading ring pleaded guilty to securities fraud charges. This might make it difficult for his cohorts to substantiate their not-guilty pleas. [DealBook / New York Times]

* “This is a tale with no shortage of knaves or villains.” If you’re interested in learning about Chevron’s legal wranglings in Ecuador and with plaintiffs attorney Steven Donziger, there are a bunch of interesting new readings for you to peruse. [WSJ Law Blog]

* Crisis in legal education be damned! They may have bad timing, but these law schools are focusing on building bigger and better facilities for students they’re unable to put in their seats. [National Law Journal]

* Ohio law schools have taken a bruising in terms of decreased enrollment, but the University of Toledo has faced the worst of it. With a 25.9% reduction in 1Ls, tuition cuts can only do so much. [Toledo Blade]

* Law student sends naked selfie to her father. Hilarity ensues. [Inside Edition]

* “Is insider trading bad?” Asking for a friend. [The Atlantic]

* Judge catches law firm cheating on the page limit. Apparently, Judge Carl Barbier was well-versed in the “slightly less than double-spaced” trick. [NPR]

* What’s the matter with (statutory interpretation in) Kansas? [KSN]

* You may have heard that technology is going to gut the market for low-level lawyering. If not, here’s a wakeup call. [Forbes]

* This year’s MacArthur genius grant recipients. Is your name on the list? SPOILER: No. But a William Mitchell Law professor is. [New York Times]

* Steve Klepper’s fair-minded and favorable review of Lat’s forthcoming book, Supreme Ambitions (affiliate link). [Maryland Appellate Blog]


* Uh oh! The Second Circuit is having a copy/paste problem in that it copied and pasted the wrong legal standard into twelve of its immigration opinions from 2008 to 2012. Embarrassing. [WSJ Law Blog]

* Am Law named the grand prize winners of the magazine’s Global Legal Awards for the best cross-border work in corporate, finance, disputes, and citizenship. Was your firm honored? [Am Law Daily]

* An attorney at this Louisiana law firm was apparently attacked by a co-worker’s husband who claimed that the lawyer was behind his cuckolding. We may have more on this later. [Louisiana Record]

* A computer systems engineer at Wilson Sonsini has been charged with insider trading. This is the second time in three years that an employee from the firm has been charged with this crime. [Bloomberg]

* The best way to navigate common mistakes in the LSAT logical reasoning section is to display your logical reasoning capabilities by not taking the LSAT right now. [Law Admissions Lowdown / U.S. News]

Judge Jill Pryor

* Mathew Martoma, the former Harvard law student who fabricated his transcript when applying for clerkships, gets nine years in prison for insider trading. [DealBook / New York Times]

* If Bingham McCutchen moves forward on merger talks with Morgan Lewis, a bunch of Bingham partners might bail. [American Lawyer]

* Congratulations to Judge Jill Pryor, who will join Judge Bill Pryor on the Eleventh Circuit. [Fulton County Daily Report]

* Can you be fired for medical marijuana in Colorado, where the drug is legal even for recreational purposes? [ABA Journal]

* Dewey have some good news for the embattled ex-leaders of the defunct law firm? [New York Law Journal]

* Home Depot is the latest major retailer to be hit by a data breach. [Washington Post]

Rengan Rajaratnam and Dan Gitner

It’s bad luck to get a haircut during trial.

Daniel Gitner of Lankler Siffert & Wohl, commenting on one of the personal grooming superstitions he forces those staffing cases with him to adopt. Gitner recently broke U.S. Attorney Preet Bharara’s winning streak in the successful prosecution of insider trading cases when his client, Rengan Rajaratnam, was acquitted. Gitner cut his hair after the trial concluded.

Insider trading is one of those activities that you should avoid. If you’re a lawyer, it’s an activity you should definitely avoid. It’s not really all that hard to steer clear of insider trading either. Obviously there are some murky cases, but it’s wise to err on the side of caution.

On the other hand, there are also cases where the SEC says a close friend of a company’s executive is emailing you and telling you which days to buy because “[e]arnings are being released on the 30th along with some good news,” and “[l]ooking forward to getting paid back. Good luck…. SHHHHHHHHHHHHH!!!!!!!!!!!!!!!!!!” Those are the cases where you probably should walk away.

Put aside the insider trading: what lawyer is using email to have these conversations?

double red triangle arrows Continue reading “Biglaw Partner Charged With Insider Trading On The Golf Course”

I don’t want to minimize my guilt, as a lot of people here do. But [I] didn’t need a sentence that matches what people get for killing people or for raping people.

Matthew Kluger, formerly of Wilson Sonsini, commenting on the harshness of his 12-year sentence for insider trading, the longest sentence “ever meted out” in such a case. Kluger currently resides at “Club Fed.”

Time Magazine cover boy Preet Bharara

In the federal criminal world, there are certain cases where the government almost always wins.

Illegal reentry for a previously deported person, for example, is pretty close to a lock for a government win — all the government has to show is that the person isn’t a citizen, was previously deported, and is in the United States again. If the dude’s in the courtroom, the government is a third of the way there. For example, in the last fiscal year, there were 20,840 folks charged with illegal reentry.  Four of them were acquitted at trial.

Similarly, bank robbery is a high-percentage game for the government. These days, most banks have amazing technology that lets them record pretty much everyone inside. Last fiscal year, 896 people were charged with bank robbery. One lucky guy was acquitted.

These days, federal law enforcement is using wiretaps and, according to the Wall Street Journal, old-school sting operations, to go build white-collar cases (it’s a pretty cool article — very cloak and dagger). The strategies that got the federal government the conviction rate it has in drug and gun cases are being applied to investment fraud and insider trading cases.

This is one reason that insider trading cases have looked like as much of a layup as a bank robbery case. The U.S. Attorney’s Office in the Southern District of New York has secured a record of 85 convictions in either guilty pleas or trials without a single loss.

Until this week….

double red triangle arrows Continue reading “The Trouble With Insider Trading Prosecutions”

* Alan Jacobs, Dewey’s bankruptcy trustee, says his clawback suit shouldn’t be stayed during the defendants’ criminal cases — after all, he doesn’t want their assets to dry up while they “scramble to defend themselves.” [New York Law Journal]

* Rengan Rajaratnam, Raj Rajaratnam’s little brother, was acquitted in his insider trading conspiracy case. It’s the first defeat in Preet Bharara’s financial crackdown against hedge funds. Tough break, dude. [DealBook / New York Times]

* Sore loser? Andrew J. Weinstock, the public defender who got into a fight with Judge John “I’ll Just Beat Your Ass” Murphy, resigned from his position in protest of the judge’s return to the bench. [WSJ Law Blog]

* There are many things nontraditional applicants should ask before going to law school, including, but not limited to, whether they’ll ever be able to find employment after graduation. [U.S. News & World Report]

* Oscar Pistorius’s attorney closed his defense of his client in the ongoing murder trial, and Judge Thokozile Masipa has adjourned all arguments in the controversial case until next month. [Bloomberg]

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