Rajat Gupta’s conviction on insider trading charges was the absolute correct verdict given the evidence presented at trial — but some of that evidence should be tossed, his lawyer said today.
“It may in fact be true” that Gupta’s conviction for passing illegal tips to hedge fund manager Raj Rajaratnam was a “virtual certainty,” his lawyer Seth Waxman argued before a panel of federal appeals-court judges.
But toss the wiretap evidence and there would be a different outcome, Waxman said.
The awkward argument was made within earshot of Gupta; his wife, Anita; their daughters; and other friends and family, who attended the hearing in downtown Manhattan.
Gupta, the former head of consulting firm McKinsey, is out on bail pending appeal. He was convicted last year of feeding Rajaratnam tips he gleaned as a director of Goldman Sachs, including Warren Buffett’s $5 billion investment into Goldman at the height of the financial crisis.
Gupta’s lawyer said the wiretaps used to convict Gupta didn’t include the Goldman director himself — and therefore they should have qualified as hearsay and been tossed.
One of the judges on the panel, Rosemary Pooler, questioned the admissibility of a taped chat between Rajaratnam, and one of his portfolio managers.
In the call, Rajaratnam tells the manager, David Lau, that he “heard yesterday from someone who’s on the board of Goldman Sachs,” that the firm will lose $2 a share in the upcoming quarter.