Sentence Nacchio Based on Actual Qwest Insider Profit, 10th Circuit Says
Posted Jul 31, 2009 4:32 PM CST
By Martha Neil
In a move that could nearly halve the six-year prison term that former Qwest Communications chief executive Joseph Nacchio got for insider trading, the 10th U.S. Circuit Court of Appeals today ordered that he be re-sentenced.
Both Nacchio's prison term and the amount of money he is required to forfeit must be recalculated based not on his gross profit but on what he actually gained due to insider knowledge, reports the Denver Post.
"[A]n insider-trading defendant's 'gain' should not consist of the total amount that the defendant realized from his or her stock sales but should be limited, more specifically, to the gain that resulted from trading with insider knowledge," the appellate panel explains.
The Wall Street Journal Law Blog provides a link to a copy of the 10th Circuit's written opinion.
Earlier coverage:
ABAJournal.com: "En Banc Appeals Court Reinstates Conviction of Ex-Qwest CEO"
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Comments
B. McLeod
Aug 1, 2009 6:24 PM CST
I guess the 10th Circuit judges were not suspicious when, instead of the defendant testifying as to what trades were made due to inside information, a statistician gave expert testimony as to the portion of the trades he deemed statistically allocable to the inside information.
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