Mathew Martoma wants a do-over.
The former SAC Capital portfolio manager, convicted of carrying out the most profitable insider trading scheme ever, has asked a federal judge to throw out a jury verdict or order a new trial.
Prosecutors “failed to prove beyond a reasonable doubt that Mr. Martoma committed any of the charged offenses,” lawyers for the 39-year-old money man claim in a 45-page motion filed late Thursday.
Michael Steinberg, a second SAC executive, was also convicted of insider trading, but he has not filed an appeal of his Dec. 18 jury verdict.
Steinberg is scheduled to be sentenced April 25.
In addition to the government not proving its case against Martoma, his jury was “presumptively biased” because of information made public during the trial about the ex-SAC executive’s expulsion from Harvard Law School, lawyers for the former portfolio manager said in the filing.
Though never disclosed to the jury, the Harvard expulsion, which was contained in previously sealed documents, revealed that Martoma had forged his law-school transcript to show A grades in hopes of getting a prestigious federal-judge clerkship.
When Harvard discovered the forgery, Martoma concocted an elaborate story to cover up his transgression and was subsequently booted from the law school.
The scandalous Harvard revelations were widely reported. Jurors and prospective jurors were advised not to read press reports on the case. During the trial, at least 65 articles mentioned Martoma’s dismissal during the course of the trial, according to Thursday’s memo.
Martoma’s lawyers also argue that the government’s star witness, Dr. Sidney Gilman, could not be trusted. “Gilman’s testimony was rife with inaccuracies and inconsistencies that underscored his lack of reliability, they said.
A 12-person jury found that a consultancy arrangement between the renowned neurologist and the hedge-fund manager led to the eventual disclosure of inside information on drug trials that Martoma used to help SAC make $275 million in profits and averted losses on drug stocks Elan and Wyeth.
“In answering the Government’s questions, Dr. Gilman was open, forthcoming, and responsive,” Martoma’s lawyers said. “In answering Mr. Martoma’s questions, Dr. Gilman was evasive, hostile, and even obstructionist — repeatedly expressing ‘confusion’ about questions and necessitating intervention from the Court.”
Martoma, who is facing 15 to 20 years in prison, is set to be sentenced June 20.
Six other former SAC employees have pled guilty to insider-trading charges. SAC settled similar criminal charges brought against it. A hearing to approve that settlement is set for March 14.