Rajat Gupta seeks revocation of conviction
07 March 2015
Rajat Gupta, the jailed former director of Goldman Sachs, has filed a fresh plea in a US court seeking to overturn his conviction as prosecutors have failed to prove that he received personal benefits for passing information.
Gupta, currently serving a two-year jail term on insider trading charges, has filed a fresh plea in the Manhattan federal court seeking an order "vacating his sentence, setting aside the judgment against him, and discharging him from prison".
The former McKinsey head was convicted on charges of illegally passing on information to hedge fund founder and billionaire friend Raj Rajaratnam.
In his plea, Gupta has argued that the government did not provide evidence to prove he received personal benefits in exchange for passing confidential Goldman Sachs information.
Gupta, 66, who was convicted in 2012, began serving a two-year prison term on insider trading charges in June 2014. His petition for a certiorari (a writ seeking judicial review) in the criminal case is pending before the Supreme Court.
Gupta's lawyer Gary Naftalis filed a 21-page memorandum stating that the trial jury was not properly instructed regarding insider trading tips and the benefit accrued to Gupta.
The "erroneous jury instructions" permitted the jury to convict Gupta "without finding that his tips were part of an agreed upon exchange of tips for consequential benefits, resulting in his conviction for conduct that is not a crime", according to the filing.
Naftalis said the fact that Gupta gained nothing in exchange is enough to support the argument that he was utterly without motive to participate willfully in an insider trading scheme.
"Following a long and successful professional career of the utmost probity, at the pinnacle of the business world, with no shortage of lucrative post-McKinsey business opportunities and in the absence of anything resembling financial need, Gupta lacked any such motivation," he said.
Naftalis said there was no agreement to pay cash for tips, to share trading profits or to trade tips for other tips. "Indeed, there was no direct evidence of any quid pro quo at all. Nor was there any evidence showing that Gupta even knew what Goldman Sachs trades Rajaratnam directed, the size or dollar amount of those trades, or how much money Rajaratnam made," the memorandum said.
The government has time till April to file its response to the defence motion.