If the spandex fits, you must acquit.
Earlier this afternoon, opening statements in the Raj Rajaratnam case were heard, with the prosecution telling the jury, “exploited a corrupt network of people to earn millions of dollars in illegal profits,” including Rajat Gupta, a former McKinsey partner and Goldman Sachs director. This accusation, according defense attorney John Dowd, could not be further from the truth. “The government has it wrong,” Dowd said, adding that prosecutors “didn’t do their homework.” You want to know how Raj made all that money? He’ll tell you how.
Dowd told jurors that Rajaratnam’s firm “conducted the best research” in the business, had the benefit of expert analysis, and reached decisions “based only on public information.”
“He assembled a mosaic of information and did his own calculations,” Dowd said after outlining for jurors how Rajaratnam — or “Raj, to his friends” — launched Galleon after emigrating to the U.S. It’s “natural” for “people like Raj” to develop information, Dowd said. “Talking to corporate executives is what Raj did for a living,” Dowd said. “It’s what investors hired him to do.” Dowd said the stock trades at issue in this case are just a “tiny percentage” of the billions of dollars of trades that Galleon did each year. “The information Raj gathered was available to anyone willing to work hard,” he said. Galleon “hired professional research consultants” and its traders “questioned executives from companies themselves,” he said.
“They would analyze company’s published statements and regulatory filings,” as part of “exhaustive research,” Dowd said. “The evidence will show that Raj did not cheat.”
If the jury would like evidence of Raj’s exhaustive research, it need look no further than the hedge fund’s investment in Lululemon. Pretty sure someone who’s getting inside info doesn’t need to make junior analysts buy and model spandex on the conference room table. The ass alone should prove innocence. Having said that, how dare Dowd suggestion a) Raj has the “best” research in the biz and b) that he’s the only one who goes to such great lengths to research and analyze companies. I’ll have him know that at Southern Connecticut’s premiere hedge fund, the founder takes an even more hands on approach to this sort of thing, modeling the goods offered by retailers like American Apparel himself, rather than passing the work off onto an underling.
Rajaratnam Defense Lawyer Says US ‘Has It Wrong’