A U.S. judge on Tuesday dismissed two securities fraud counts against Rengan Rajaratnam, the younger brother of Galleon Group founder Raj Rajaratnam, in a surprise development in the federal criminal insider trading case.
Reuters reports that Rengan Rajaratnam still faces a criminal count of conspiracy, but U.S. District Judge Naomi Reice Buchwald at a hearing in Manhattan dismissed other counts related to improper trading in technology company Clearwire Corp.
Buchwald said the issue was whether Rengan Rajaratnam traded on inside information about Clearwire knowing the tipper breached his duties to keep it secret and in exchange for a personal benefit.
'I find a reasonable jury could not so find', she said.
The decision came shortly after prosecutors rested in presenting evidence in the latest in a string of insider trading cases pursued by Manhattan U.S. Attorney Preet Bharara.
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