Apple store on 3rd Street Promenade in Santa Monica, California. Photo: View Apart/Shutterstock

Opposing attorneys in a criminal case against a former in-house attorney at Apple Inc. accused of insider trading have been arguing whether it is constitutional to charge someone with insider trading.

In February 2019, Gene Levoff was charged with securities fraud and wire fraud in the U.S. District Court for the District of New Jersey. Specifically, the U.S. Justice Department claims that Levoff sold stock he owned in the company during blackout periods. The alleged scheme, according to prosecutors, allowed Levoff to make $27,000 on some trades and avoid losses of approximately $377,000 on others because of insider information he obtained while working at the company. Levoff was charged with six counts of wire fraud and six counts of securities fraud.

In April, Levoff's attorney, Kevin Marino, founding partner at Marino, Tortorella & Boyle in Chatham, New Jersey, moved to dismiss the charges arguing that insider trading has never been made into law by Congress. He said the definition of insider trading has been created by judges and the prosecution of insider trading is unconstitutional.

In May, prosecutors filed a response saying the motion was a "Hail Mary" and the arguments in the motion "fly in the face of binding Supreme Court precedent."

"Congress has repeatedly ratified the Supreme Court's interpretation of insider trading law in modifying Section 10(b) and passing new insider trading legislation consistent with Supreme Court precedent," prosecutors wrote in their response.

Prosecutors also contend the motion to dismiss ignores the six counts of wire fraud in the indictment.

Marino responded to prosecutors Wednesday in a letter to U.S. District Judge William Martini of the District of New Jersey arguing the government "does not want to respond to Levoff's motion and doesn't think it has to."

"Consistent with its 30,000-foot approach to Levoff's motion, the Government labels his conduct 'insider trading at its most basic,' but fails to supply the statutory definition of the crime—a curious tactic if its proposition is indeed so obvious," Marino said.

Marino argues prosecutors rely on the STOCK Act for arguing the ratification of insider trading, but said the law does not "textually define insider trading" nor does it commit to a particular judge-made definition.

Heather Suchorsky, Courtney Howard and Daniel Shapiro are prosecuting the case. A spokesperson for the U.S. Attorney's Office for the District of New Jersey said they did not have a comment on the case.

Marino did not immediately respond to a request for comment Thursday.