Elan Corp shareholders who sued SAC Capital Advisors LP and founder Steven Cohen for insider trading asked the judge presiding over the hedge fund’s criminal case to reject any accord SAC has reached with prosecutors unless it pleads guilty to the conduct alleged in their case.
Investors in Elan and Wyeth told US District Judge Laura Taylor Swain on Friday that they are “crime victims” of the alleged fraud perpetrated by Stamford, Connecticut-based SAC. If a plea bargain is reached that does not include the fund’s admitting wrongdoing for insider trading in Elan and Wyeth, it should be rejected, they argued in a letter to the court.
SAC and Cohen have been told that US$1.8 billion and admission of wrongdoing by the fund would be the price of resolving the insider-trading charges, people familiar with the matter said.
The amount would be about US$1.2 billion paid as a result of a criminal probe by Manhattan US Attorney Preet Bharara and includes the more than US$600 million that Cohen has already agreed to pay the US Securities and Exchange Commission to settle a related suit.
“According to published news reports, a plea agreement could be executed by defendants and the government and submitted to the court as soon as today,” Ethan Wohl, a lawyer for the plaintiffs, said in the letter. “The plea being negotiated will allow defendants to plead guilty and pay a fine in excess of US$1 billion without admitting liability for insider trading in Elan or Wyeth. A plea agreement on those terms, if tendered to the court, should be rejected.”
Prosecutors have charged Mathew Martoma, a former SAC money manager, with using illegal tips about an Alzheimer’s drug trial to help the firm make profits or avoid losses totaling US$276 million by trading in Elan and Wyeth, in a case the US called the largest insider-trading scheme in history. Martoma pleaded not guilty and is scheduled to go to trial in January.
SAC was indicted in July, accused of operating a conspiracy that stretched as far back as 1999, including trades by Martoma, and reaped hundreds of millions of dollars in illicit profit.
The lawyer said a federal court can reject a plea agreement if it determines that, if any charges are to be dismissed as part of an agreement, the ones remaining reflect “the seriousness of the actual offense behavior.”
While Cohen was not charged in either case, Wohl noted that the SEC has said that he “personally received and benefited” from inside information on trades with Martoma.
GROWING OWINGS: While Luxembourg and China swapped the top three spots, the US continued to be the largest exposure for Taiwan for the 41st consecutive quarter The US remained the largest debtor nation to Taiwan’s banking sector for the 41st consecutive quarter at the end of September, after local banks’ exposure to the US market rose more than 2 percent from three months earlier, the central bank said. Exposure to the US increased to US$198.896 billion, up US$4.026 billion, or 2.07 percent, from US$194.87 billion in the previous quarter, data released by the central bank showed on Friday. Of the increase, about US$1.4 billion came from banks’ investments in securitized products and interbank loans in the US, while another US$2.6 billion stemmed from trust assets, including mutual funds,
AI TALENT: No financial details were released about the deal, in which top Groq executives, including its CEO, would join Nvidia to help advance the technology Nvidia Corp has agreed to a licensing deal with artificial intelligence (AI) start-up Groq, furthering its investments in companies connected to the AI boom and gaining the right to add a new type of technology to its products. The world’s largest publicly traded company has paid for the right to use Groq’s technology and is to integrate its chip design into future products. Some of the start-up’s executives are leaving to join Nvidia to help with that effort, the companies said. Groq would continue as an independent company with a new chief executive, it said on Wednesday in a post on its Web
RESPONSE: The Japanese Ministry of Finance might have to intervene in the currency markets should the yen keep weakening toward the 160 level against the US dollar Japan’s chief currency official yesterday sent a warning on recent foreign exchange moves, after the yen weakened against the US dollar following Friday last week’s Bank of Japan (BOJ) decision. “We’re seeing one-directional, sudden moves especially after last week’s monetary policy meeting, so I’m deeply concerned,” Japanese Vice Finance Minister for International Affairs Atsushi Mimura told reporters. “We’d like to take appropriate responses against excessive moves.” The central bank on Friday raised its benchmark interest rate to the highest in 30 years, but Bank of Japan Governor Kazuo Ueda chose to keep his options open rather than bolster the yen,
Even as the US is embarked on a bitter rivalry with China over the deployment of artificial intelligence (AI), Chinese technology is quietly making inroads into the US market. Despite considerable geopolitical tensions, Chinese open-source AI models are winning over a growing number of programmers and companies in the US. These are different from the closed generative AI models that have become household names — ChatGPT-maker OpenAI or Google’s Gemini — whose inner workings are fiercely protected. In contrast, “open” models offered by many Chinese rivals, from Alibaba (阿里巴巴) to DeepSeek (深度求索), allow programmers to customize parts of the software to suit their
RSS