[ by Howard Haykin ]

Rajat Gupta, a former Goldman Sachs board member, requested that a federal appeals court reverse his conviction on insider trading charges, on the basis that a judge made a series of incorrect rulings during his trial.  In their written arguments to the U.S. Court of Appeals for the 2nd Circuit in Manhattan, Gupta's lawyers specifically referred to the lower court's "serious evidentiary errors, which decisively tipped the scales in this case."

Mr. Gupta, 64, of Westport, CT, was convicted by a jury of having leaked boardroom secrets to his friend, the former hedge fund manager, Raj Rajaratnam.  Gupta currently is free on bail pending the resolution of his appeal. 

Wiretap Argument.   Gupta's lawyers made several other arguments on appeal.  Among the most significant arguments is that the government should not have been allowed to use certain wiretap evidence during the trial.  Trial Judge Jed Rakoff allowed the jury to hear 2 incriminating taped conversations involving Mr. Rajaratnam and his traders suggesting Mr. Rajartanam had a source inside Goldman.  On the tape considered to be the most damaging to Mr. Gupta's case, Rajaratnam is heard telling a colleague:  "I heard yesterday from somebody who's on the board of Goldman Sachs that they are going to lose $2 per share." 

Mr. Gupta's lawyers argued referred to that evidence as being the unreliable hearsay testimony "of a known fabulist."  They added:  "Without a proper basis for admission, these untestable, unreliable hearsay statements had no place in a criminal trial, and their admission alone compels reversal."

Another Argument.   It's also argued that Judge Rakoff erred in curtailing the testimony of Mr. Gupta's daughter, Geetanjali Gupta, who had planned to testify that her father was furious with Mr. Rajaratnam because of a money-losing investment he had made with the hedge fund manager.  Such testimony "would have led the jury to question whether Gupta had any motive to tip the man who had stolen millions from him."

Seth Waxman is spearheading Mr. Gupta's appeal ... assisted by Mr. Gupta's trial team at Kramer Levin Naftalis & Frankel, led by Gary Naftalis.   Mr. Waxman served as a U.S solicitor general during the Clinton administration - the federal government's top appellate advocate.  Now a partner at WilmerHale, Mr. Waxman has argued more than 50 cases before the Supreme Court.

For further details, go to:  [ Dealbook, 1/22/13 ].