Former SAC Capital Advisors LP portfolio manager Mathew Martoma lost a bid to remain free while he fights a conviction for perpetrating the most lucrative insider-trading scheme in U.S. history, as a federal judge expressed doubt that his appeal will succeed.
Martoma, 40, is scheduled to begin his nine-year prison sentence on Nov. 10. U.S. District Judge Paul Gardephe in Manhattan, who presided over the trial, said Oct. 21 the former hedge fund manager failed to show any substantial grounds for reversal of his conviction on two counts of securities fraud and one count of conspiracy. Martoma’s lawyers had argued his appeal would raise “several close questions” including whether evidence in his favor was improperly excluded and his sentence was “unreasonable.” Martoma had also asked Gardephe to delay his surrender date to prison.
Gardephe said that evidence presented after a month-long trial shows Martoma engaged in an insider-trading scheme from 2006 to July 2008. Martoma was convicted of making $275 million for SAC by using illegal tips to trade in Elan Corp. and Wyeth LLC.
“The evidence of Martoma’s guilt at trial was overwhelming,” Gardephe said. “None of Martoma’s arguments regarding the sufficiency of the evidence or legal error at trial are persuasive.
Nor has Martoma articulated any basis for finding that his sentence was procedurally or substantively unreasonable.”
Richard Strassberg, a lawyer for Martoma, declined to comment on the ruling. He said earlier in court papers that if Gardephe denied the request, he’d ask the federal appeals court in Manhattan to delay the former hedge fund manager’s surrender to prison pending the outcome of the challenge.
– Bloomberg News