The judge in Mathew Martoma’s insider-trading trial warned his lawyers against questions tied to Steven Cohen’s trading strategies, saying it could open the case to a wider probe of the SAC Capital Advisors founder.
'General questions about how Steve Cohen conducted his trading I think are very dangerous - dangerous in the sense that they represent a risk of opening the door to a broader examination of how Steve Cohen did business', U.S. District Judge Paul Gardephe told a lawyer for Martoma outside the hearing of jurors and spectators Wednesday, according to a transcript. 'And I think we all agree that that is not a path we want to go down.'
Bloomberg reports that the warning came as Martoma’s lawyer was questioning a research trader characterized as Cohen’s 'right-hand man' in an attempt to distance the defendant from trades prosecutors claim were based on inside information.
Martoma is on trial in federal court in Manhattan after prosecutors failed to persuade him to cooperate in their investigation of Cohen. The government claims Martoma had a 20-minute phone call with Cohen in July 2008 after getting non-public results of a clinical drug trial of bapineuzumab, which was intended to treat Alzheimer’s disease.
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image: © Clyde Robinson