Rajaratnam trial: No word from jury on Day 4

By Grant McCool

NEW YORK (Reuters) - Apart from the murmur of voices and bursts of laughter, nothing was heard on Thursday from 12 jurors studying the evidence in hedge fund manager Raj Rajaratnam's high-profile insider trading trial.

Unlike the past three days of deliberations, no notes emerged from the jury room in Manhattan federal court asking for exhibits or to hear replays of FBI phone taps central to what U.S. prosecutors call the biggest probe of insider trading at hedge funds on record.

The panel began its deliberations on Monday after hearing seven weeks of often complex evidence. They will resume deliberations on Friday in a shortened session of three hours because of juror commitments, U.S. District Judge Richard Holwell said in court.

Litigation experts are always loathe to analyze the behavior of sitting jurors or predict when they will deliver a verdict, but some say this panel has a lot of work to do in deciding the fate of Galleon Group founder Rajaratnam.

"I think the volume of information there and the jury sensing the importance of the case will likely cause them to take their time," said Artur Davis, a former federal prosecutor and congressman who is a partner at SNR Denton law firm in Washington D.C.

A conviction would likely lead to more probes involving the use of secretly recorded phone calls and an acquittal would be a huge blow to one of the U.S. Department of Justice's priorities in fighting wrongdoing on Wall Street.

Toward the end of the lunch hour, the sound of several people laughing and then clapping was heard from the locked jury room adjoining the courtroom. At other times, only the low murmur of voices could be heard.


Sri Lankan-born Rajaratnam spent most of the day sitting with his lawyers, John Dowd and Terence Lynam, in nearby courtrooms on the 17th floor of the building where the trial began on March 8. The lawyers have been colleagues for decades at Akin Gump Strauss Hauer & Feld LLP in Washington, D.C.

Half of the trial courtroom was filled with journalists while four friends of Rajaratnam also waited for the verdict. The judge came up to the bench from his chambers at various times during the day to hear other cases on his calendar.

The jury is considering prosecution evidence that Rajaratnam, 53, traded on corporate secrets leaked by highly placed insiders such as a former director at Goldman Sachs Group Inc <GS.N>, Wall Street's most influential bank. The government accuses Rajaratnam of making an illicit $63.8 million from 2003 to March 2009.

The defense team presented the panel with a blizzard of data to show the one-time billionaire drew on a vast collection of research and public information to make his trades, not secrets, and asked for an acquittal.

If convicted on charges of securities fraud and conspiracy, Rajaratnam could be imprisoned for up to 25 years. Rajaratnam, who was arrested in October 2009, is the only one out of 26 charged in the broad Galleon case to go on trial so far. Twenty-one have pleaded guilty.

To convict Rajaratnam, the government's evidence must convince all of the panel beyond a reasonable doubt that he received material nonpublic information from people who had a fiduciary duty not to disclose it and that he knew it was wrong to trade on it.

The case is USA v Raj Rajaratnam et al, U.S. District Court for the Southern District of New York, No. 09-01184.

(Reporting by Grant McCool and Basil Katz; Editing by Phil Berlowitz)