SAC Fund Manager Martoma Seeks to Stay Free During AppealBob Van Voris
Former SAC Capital Advisors LP portfolio manager Mathew Martoma, scheduled to begin a nine-year prison sentence Nov. 10 for what the U.S. called the most lucrative insider-trading scheme ever charged against an individual, asked a court to let him stay free while he appeals.
Martoma, 40, isn’t a risk to flee and will raise “substantial questions” in his appeal that may lead to a reversal of his February conviction, his lawyer, Richard Strassberg, told U.S. District Judge Paul Gardephe in Manhattan in a letter yesterday.
Martoma, who hasn’t submitted his opening brief with the federal appeals court in New York, argued in a trial court filing after his conviction that the jury lacked sufficient evidence to convict him. He also claimed jurors must have been prejudiced by reports of Martoma’s 1999 expulsion from Harvard Law School for creating a phony transcript of his grades. Gardephe denied the request to throw out the verdict.
Strassberg said in the letter that Martoma will also argue on appeal that evidence was improperly kept out of the trial and that his sentence is unreasonable.
Martoma was convicted of making $275 million for SAC by using illegal tips to trade in Elan Corp. and Wyeth LLC. He rejected government offers of leniency in exchange for his cooperation in the government’s probe of SAC founder Steven A. Cohen and his Stamford, Connecticut-based hedge fund.
Martoma got the longest sentence of seven former SAC analysts and fund managers to be convicted. The SAC investigation was part of a larger government crackdown on insider trading at hedge funds including Galleon Group LLC, co-founded by Raj Rajaratnam.
If Gardephe rejects Martoma’s bid to remain free during the appeal, Strassberg asked him to delay his client’s surrender date for three weeks so Martoma can ask the appeals court to grant the request.
The case is U.S. v. Martoma, 12-cr-00973, U.S. District Court, Southern District of New York (Manhattan).