Former hedge fund managers Anthony Chiasson and Todd Newman just scored a final victory after five years of battling insider trading allegations.
Chiasson, the cofounder of now-defunct hedge fund Level Global, and Newman, who worked at Diamondback, were codefendants accused of trading on inside information in Dell and Nvidia stocks.
The FBI raided Level Global and Diamondback in November 2010, and the two were convicted in May 2013.
The United States Court of Appeals for the Second Circuit reversed that decision in December, leading Solicitor General Donald Verrilli to file a petition in July asking the Supreme Court to review the decision. That petition has now been rejected, marking the final chapter in the years-long case.
Here’s a statement from Chiasson’s attorney, Gregory Morvillo:
“Today the Supreme Court rejected the government’s efforts to rewrite well-settled insider trading law at Anthony Chiasson’s expense. The Second Circuit Court of Appeals’ pronouncement of Mr. Chiasson’s innocence, as well as that court’s harsh chiding of the government’s tactics, has withstood all challenges and is now final. Mr. Chiasson is deeply gratified by this complete vindication, one that ends the five year ordeal he and his family endured. At the same time, he notes with profound indignation that dozens of his outstanding colleagues lost livelihoods at his thriving fund which became the collateral damage of this ill-conceived prosecution. Anthony is grateful to, and shares this victory with, everyone who stood by him during this nightmare, and would like to thank his entire legal team for their brilliant advocacy on his behalf, with special thanks to Mark Pomerantz and Neal Katyal.”
US Attorney Preet Bharara, who has been cracking down on insider trading since 2009, had an almost near perfect track record for convictions until the reversal of
the insider-trading convictions.
The appeals court ruled then that “the Government failed to present sufficient evidence that the defendants wilfully engaged in substantive insider trading or a conspiracy to commit insider trading in violation of the federal securities laws.”
We reached out to Bharara’s office for comment.