The Rajat Gupta trial: An unlucky man | The Economist

The Rajat Gupta trial: An unlucky man | The Economist.

Nader Nazemi

FOLLOWING nearly a month of testimony and lengthy instruction by Judge Jed Rakoff, eight women and four men filed out of the 14th floor courtroom of a lower Manhattan courthouse on the morning of June 14th to begin deliberating six charges tied to insider trading against Rajat Gupta, a man who stood at the centre of the business world.

In the years since arriving in America as an immigrant from Kolkata, Mr Gupta developed high-level affiliations with a remarkable, almost inconceivable, number of iconic institutions, including Harvard, the University of Pennsylvania, the University of Chicago, Northwestern University, Tsinghua (in Beijing) and the India School of Business, along with Goldman Sachs, Procter & Gamble, American Airlines, KKR and McKinsey, to name only a few. Whether he will avoid an intimate relationship with one more—America’s penal system—depends on how jurors treat a pattern that ties Mr Gupta’s access to information to trades made by Raj Rajaratnam and his various employees of the Galleon Group, a large and aggressive New York-based hedge fund. Mr Rajaratnam was found guilty of insider trading last year and is currently serving an 11-year sentence.

The courtroom was full throughout the trial; one side filled with the press, including a contingent from Mr Gupta’s home country, India. Due to the lack of space, two courtroom artists sat across the aisle, next to Mr Gupta’s wife and four adult daughters. Behind them sat personal friends, many Indian, along with various attorneys (some on the prowl for follow-up litigation). They were surrounded by the FBI agents and members of the prosecutor’s office who periodically visited the courtroom. It has been an extraordinarily high-profile case, failing to draw only one possible group: any of the notable corporate or public officials who had been Mr Gupta’s colleagues.
Throughout the proceedings, Mr Gupta was stoic, immaculately dressed in a dark suit and white shirt, appearing in life as patient and sculptured as in the daily artistic renderings that ran in the local papers. It was only during the final days that his demeanour cracked, if only a bit. When his eldest daughter, Geetanjali, testified on his behalf on June 11th, he smiled at her, and did so again before the summary statements on June 13th. When Reed Brodsky, the lead prosecutor said Mr Gupta would have had to have been “the unluckiest man in the world” for his and Mr Rajaratnam’s actions to have been anything other than a criminal conspiracy, he briefly clutched his crisply-knotted tie. And, at the end of the emotional summation by his own attorney, Gary Naftalis, who derided the case against Mr Gupta as too “shabby” to cost a man his freedom, Mr Gupta appeared to weep. But he quickly regained his poise.

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