Gupta Wins One, Loses One as Judge Decides Motions

Southern District Judge Jed Rakoff (See Profile) has refused to exclude wiretap evidence from the upcoming criminal insider trial of former Goldman Sachs director Rajat Gupta. Judge Rakoff noted that another Manhattan federal judge had already ruled on the admissibility of wiretap evidence in the government’s insider trading case against convicted hedge fund manager Raj Rajaratnam. “Gupta offers no arguments different from the arguments Judge [Richard] Holwell considered in the Rajaratnam case. He argues instead that Judge Holwell’s conclusions are in error,” Judge Rakoff wrote in United States v. Gupta, 11 cr 907 on March 27. “The Court disagrees.”

But Mr. Gupta’s lawyers did get some good news from Judge Rakoff. In a separate order, Judge Rakoff ruled that federal prosecutors must review notes from about 44 interviews that the Securities and Exchange Commission conducted in its own Gupta investigation, and then hand over any potentially exculpatory Brady material. “The documents Mr. Gupta seeks were created in connection with a joint investigation between the SEC and the [U.S. Attorney's office], and it is for the purpose of preparing for the parallel criminal trial that Gupta has a substantial need for any Brady material,” Judge Rakoff wrote.