Galleon's Rajaratnam seeks to unseal Khan records

Galleon hedge fund partner Raj Rajaratnam is escorted by FBI agents after being taken into custody in New York October 16, 2009.

NEW YORK (Reuters) - Galleon Group founder Raj Rajaratnam, accused in the biggest U.S. hedge fund insider trading case, has asked a federal court to unseal records of a 2001 criminal charge against former trader Roomy Khan, one of the government's cooperating witnesses.

Khan, a former employee of Intel Corp, was charged with one count of wire fraud in a federal court in California in 2001 and pleaded guilty in 2002, drawing a sentence of home confinement.

"To ensure that Mr. Rajaratnam receives due process throughout the proceedings and a fair trial, it is vitally important that his counsel have access to the records in the case," according to a motion filed Thursday with the U.S. district court in San Jose, California.

It said that because the entire court record was sealed, Rajaratnam was unaware of an alleged transaction in which Khan provided inside information about chipmaker Intel Corp, her employer at the time, to an unidentified person at Galleon.

Khan worked for Intel more than 10 years ago.

Some 20 defendants face criminal charges, civil charges or both in Manhattan federal court in New York in an investigation that was made public on October 16. Prosecutors have identified $40 million of illegal profits, while the U.S. Securities and Exchange Commission has found $53 million in its civil investigation.

Khan is one of at least five people who have pleaded guilty to charges in the case, hoping to receive a reduced sentenced for their cooperation with the government's investigation.

The case, which misspells Khan's last name, is U.S. v. Kahn, U.S. District Court, Northern District of California, No. 01-cr-20029.

(Reporting by Grant McCool, Jonathan Stempel, editing by Dave Zimmerman)