- Sean Stewart wants judge to force his father to take stand
- Father Bob Stewart plans to invoke Fifth Amendment, papers say
A former Perella Weinberg Partners LP investment banker on trial for insider trading is trying to force his father to testify as a defense witness. But his father may refuse and invoke his Fifth Amendment rights, setting up an unusual father-versus-son legal challenge.
Sean Stewart’s insider-trading trial began Monday in Manhattan federal court as potential jurors were summoned to the courtroom. According to prosecutors, Sean tipped his father, Bob Stewart, to five health-care mergers from 2011 to 2014 while he worked as an investment banker at JPMorgan Chase & Co. and Perella Weinberg. In exchange, they say, the elder Stewart paid $10,000 for a photographer at Sean’s wedding and gave his son an additional $15,000.
The father admitted he shared tips with a friend, Dick Cunniffe, and the two traded on the information.
Sean Stewart is expected to blame his father for misusing his information and for trading on it without the younger Stewart’s knowledge, according to court papers. Bob pleaded guilty and was sentenced to probation. He told a judge he traded on information from his son but didn’t say Sean knew he was using it.
Sean’s lawyers argued that after his arrest, Bob told FBI agents that his son didn’t know anything about his trades. Last week, the lawyers subpoenaed Bob as a witness, in hopes of bolstering their defense.
A lawyer for the elder Stewart said he’s invoking his constitutional right not to testify, according to court documents. Under the Fifth Amendment to the U.S. Constitution, a witness can’t be forced to give evidence that would incriminate himself.
In a letter to the Judge Laura Taylor Swain, Sean’s team argued that the elder Stewart is not at risk of incriminating himself because he already pleaded guilty and been sentenced. In Bob’s plea agreement, federal prosecutors say they won’t pursue him further for insider trading in the five companies.
The judge plans to hold a hearing this week to determine whether Bob Stewart must take the stand. Bob’s lawyer, Jillian Berman, didn’t respond to an e-mail and phone message seeking comment on the case.
The elder Stewart may be worried about acts falling outside the agreement or a possible prosecution by state authorities, said Stephen A. Miller, a former federal prosecutor with the firm Cozen O’Connor in Philadelphia.
“Clearly you would think the father wants to help the son,” said Miller. “There must be something out there that’s causing concern.”
The case is U.S. v. Cunniffe, 15-cr-00287, U.S. District Court, Southern District of New York (Manhattan).