Yesterday, jurors heard a series of wiretapped conversations between Danielle Chiesi, Raj Rajaratnam and Kieran Taylor, in which they discuss trading Akamai Technologies stock back in 2008.
In one of those calls, Chiesi told Raj that Akamai is going to lower its earnings guidance, a few days before the company revealed the details publicly in July of that year. Prosecutors say Chiesi was tipped by Taylor, who at the time, worked for the tech company.
The government says that after he received the tip, Raj increased his short position on the stock from 300,000 shares to 875,000 shares, just before the public announcement on July 30.
“They’re gonna guide down. I just got a call from my guy,” Chiesi said to Raj. “I played him like a finely tuned piano.” Then she urged Raj to act before Wednesday, when Akamai would go public with the downgrade.
After the announcement on Wednesday, at precisely 5:30 pm, Raj called Chiesi. “I just wanted to say thank you,” he said. The news of the reduced projections had sent the stock tumbling by more than 25%, Akamai’s CFO testified yesterday.
The defence showed jurors a Goldman Sachs analyst report. They said that “anyone could draw the conclusion that the company would reduce its earnings guidance for 2008 based on the competitive pressures it faced,” according to the FT.
Listen to the call: