Rajat Gupta asked to repay $6.22 million to Goldman

Tue Feb 26, 2013 4:30am IST

Former Goldman Sachs Group Inc board member Rajat Gupta departs Manhattan Federal Court after being sentenced in New York, October 24, 2012. REUTERS/Lucas Jackson/Files

Former Goldman Sachs Group Inc board member Rajat Gupta departs Manhattan Federal Court after being sentenced in New York, October 24, 2012.

Credit: Reuters/Lucas Jackson/Files

Related Topics

Stocks

   
Rajalakshmi (C), 28, smiles after winning the Miss Wheelchair India beauty pageant in Mumbai November 26, 2014. REUTERS/Danish Siddiqui

Miss Wheelchair India

Seven women from across India participated in the country's second wheelchair beauty pageant, which aims to open doors for the wheelchair-bound in modelling, film and television, according to organisers  Slideshow 

REUTERS - A federal judge on Monday ordered former Goldman Sachs Group Inc(GS.N) director Rajat Gupta to reimburse $6.22 million to the bank to help cover its legal expenses related to his criminal insider trading case.

Goldman had sought to recover $6.91 million from Gupta, and U.S. District Judge Jed Rakoff said the bank had proved it was entitled to 90 percent of what it requested.

Gupta is appealing his June 15, 2012 conviction and two-year prison term for leaking boardroom secrets to Raj Rajaratnam, the hedge fund manager at the center of a multi-year U.S. government crackdown on insider trading.

Goldman had sought to recover the fees it had paid its law firm Sullivan & Cromwell in connection with the case and related matters, citing the federal Mandatory Victims Restitution Act, which requires restitution in some fraud cases.

Gupta had opposed making restitution but Rakoff, who presided over his criminal trial, said nearly all of what Goldman sought was a "necessary, direct, and foreseeable result of the investigation and prosecution of Gupta's offense of conviction and thus well within the statute's coverage."

Rakoff said Goldman could also recover legal costs linked to a related U.S. Securities and Exchange Commission civil case against Gupta, and to the criminal case against Rajaratnam.

But Goldman did not deserve all it sought, the judge said.

Some billing entries did not qualify because they involved civil cases that followed the criminal conviction, Rakoff said.

And the investment bank on "a few occasions" assigned too many lawyers to the case - "perhaps perfectly appropriate on the assumption that Goldman Sachs wished to spare no expense on a matter of great importance to it," but more than reasonably necessary under the law, the judge said.

Richard Davis, a lawyer for Gupta, said his client plans to appeal. Goldman spokesman Michael DuVally was not immediately available for comment.

The case is U.S. v. Gupta, U.S. District Court, Southern District of New York, No. 11-cr-00907.

(Reporting by Jonathan Stempel in New York; Editing by Leslie Gevirtz)

FILED UNDER:

REUTERS SHOWCASE

WTO Trade Deal

WTO Trade Deal

WTO clinches first global trade deal in its history  Full Article 

Kashmir Attack

Kashmir Attack

Ten dead in Kashmir's worst militant attack in more than a year  Read 

OPEC Meeting

OPEC Meeting

Saudis block OPEC output cut, oil price sinks further.  Full Article 

E-Commerce Boom

E-Commerce Boom

Online grocers come up trumps in India's e-commerce boom   Full Article 

GDP, RBI Preview

GDP, RBI Preview

GDP growth set to weaken, business wants reforms more than rate cut  Full Article | Related Story 

Jaitley to Rajan

Jaitley to Rajan

Jaitley likely to meet Rajan on Monday to urge rate cut  Full Article 

Banking Sector

Banking Sector

India moves to allow more businesses to offer basic financial services.  Full Article 

Jamini Roy

Jamini Roy

Photo Gallery – Bengali household name Jamini Roy’s paintings  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage