For the past few months, reporters wanting to know if Preet Bharara, the U.S. Attorney for the Southern District of New York, plans to file criminal insider trading charges against Steven Cohen, the founder of SAC Capital, have started with one person: Ellen Davis, who handles, or handled, media relations for Bharara.
Ellen Davis will have a new employer shortly, Sard Verbinnen & Co., which has handled media relations for SAC Capital for the past decade.
“I’ve known Ellen now for almost 10 years; she was at ABC covering the Martha Stewart trial, and Martha Stewart was our client,” says George Sard, the chairman and chief executive of Sard Verbinnen, who was on the phone explaining his firm’s hiring of Davis. Martha Stewart spent time in jail for lying to investigators in an insider trading case and settled with the SEC in the same matter. As for Davis, “I remember having a conversation with her about what happened in court one day—I thought she was a very astute observer of the proceedings,” he adds. “She has a law degree, which tends to translate well into the work we do.”
Any interest Steven Cohen and SAC Capital may have in what the DOJ plans is immaterial, says Sard: “Davis will not be involved in any SAC-related matters or work with any other clients currently involved in SDNY investigations.”
According to a person close to the firm, Davis got in touch with Sard a few weeks ago, hinting that she might be interested in a career shift, and Sard, a longtime admirer, jumped on the opportunity to bring her into the fold. Davis will be leaving the U.S. Attorney’s office at the end of June and joining Sard as a principal in September.
The firm is based in New York, has offices in Chicago, San Francisco, and Los Angeles, and employs around 100 people. The company’s work for the $15 billion hedge fund SAC is handled by managing director Jonathan Gasthalter. Gasthalter has had his hands full of late: One former SAC portfolio manager, Mathew Martoma, is facing a Nov. 4 trial for insider trading in two drug stocks, while a current SAC portfolio manager, Michael Steinberg, has a Nov. 18 trial date for his own insider trading case. Both have pleaded not guilty. Nine current or former SAC employees have been linked to insider trading while at the firm, as the clock counts down for prosecutors to bring charges against Cohen himself over trades that took place during the summer of 2008. Cohen has not been charged.
SAC is a significant client of Sard Verbinnen, according to the person close to the firm, but not one that makes up more than 3 percent of the firm’s revenue. There are many other clients and situations that Davis could be helpful with, given her skills and background, this person added.