October 5, 2015
Today, the U.S. Supreme Court officially refused to hear the United States v. Newman insider trading decision. By way of background:
- In December 2012, Todd Newman and Anthony Chiasson were convicted of securities fraud and sentenced to prison after their trades in certain stocks, allegedly based on a chain of material non-public information, resulted in over $70 million in gains for their hedge funds.
- In December 2014, the U.S. Court of Appeals for the Second Circuit, overturned Newman and Chiasson’s convictions finding: (a) that the corporate insiders who provided the tips prompting Newman and Chiasson’s trades, were not unlawful because the insiders did not receive a personal benefit; and (b) the government failed to prove that Newman and Chiasson knew that the original tipper received a personal benefit.
- In July 2015, the Department of Justice petitioned the U.S. Supreme Court to hear the Newman case.
- Today, the U.S. Supreme Court officially declined to review the case, without comment.