| NEW YORK
NEW YORK Feb 7 Rengan Rajaratnam, the younger
brother of imprisoned hedge fund manager Raj Rajaratnam, urged a
U.S. judge on Friday to dismiss insider trading charges leveled
against him last year.
In a motion filed in U.S. District Court in New York, his
lawyers argued the government had taken positions in the
indictment that contradicted positions prosecutors took in
trying his older brother for insider trading.
"Principles of fairness dictate that Rengan, at a minimum,
should be tried under the same standard as Raj," the defense
lawyers wrote in the motion.
A spokeswoman for U.S. Attorney Preet Bharara in Manhattan
declined to comment.
The case is one of a wave of insider trading prosecutions
pursued by Bharara's office, resulting in 79 convictions since
Raj Rajaratnam, the founder of the hedge fund Galleon Group,
received an 11-year prison sentence in October 2011 after a jury
convicted him charges related to insider trading.
A grand jury subsequently indicted Rengan Rajaratnam, a
former portfolio manager at Galleon, in March 2013 on seven
counts of conspiracy and securities fraud.
The indictment charged that Rengan Rajaratnam, 43, had
conspired with his older brother to trade on non-public
information related to technology companies Advanced Micro
Devices Inc and Clearwire Corp in 2008, resulting in
almost $1.2 million in profits.
In court papers Friday, Rengan Rajaratnam's lawyers
contended the indictment failed to allege that he knew that two
alleged tippers of inside information received a personal
benefit in exchange for providing tips to Raj Rajaratnam.
Those tippers were Rajiv Goel, an employee of Intel Corp
who admitted to passing a tip to Raj Rajaratnam, 56,
about the company's plans to invest in Clearwire, and Anil
Kumar, a former McKinsey director who said he tipped the Galleon
founder about AMD.
Both Goel and Kumar received probation in 2012 after
pleading guilty and agreeing to cooperate with the
Rengan Rajaratnam's lawyers said their client was allowed to
trade on confidential information unless he knew a tipper
disclosed it for a personal gain.
Allowing the indictment to stand without any allegation that
Rengan Rajaratnam himself knew the tippers were benefiting from
providing confidential information would be "unjust," the
lawyers say, since such proof was required at trial in the case
of Raj Rajaratnam.
Trial in Rengan Rajaratnam's case is scheduled for June 17.
His lawyer did not respond to a request for comment.
A federal jury on Thursday found Mathew Martoma, a former
portfolio manager at SAC Capital Advisors, guilty of engaging in
an insider trading scheme that enabled the hedge fund to make
profits and avoid losses of $275 million.
Separately Friday, U.S. District Judge Paul Gardephe
scheduled the sentencing for Martoma, 39, for June 10. Martoma
faces a maximum of 45 years in prison.
The cases are U.S. v. Rajaratnam, U.S. District Court,
Southern District of New York, No. 13-cr-00211; and SEC v.
Rajaratnam in the same court, No. 13-01894.