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Ex-Goldman director ordered to return $6m for legal expenses

By James Barnes

26 February 2013 at 12:47 BST

Former Goldman Sachs Group director Rajat Gupta was yesterday ordered to repay $6.22 million of a $6.9 million legal bill paid by Goldman Sachs in connection with his criminal insider dealing case.

Wall Street: Rajat Gupta ordered to pay legal bill

US District Judge Jed Rakoff in Manhattan ruled that Gupta should pay 90 per cent of the bill racked up by New York firm Sullivan & Cromwell, reports Reuters.

Confidential information

Gupta is appealing his conviction last year and two-year prison sentence for providing confidential information he had learned at Goldman board meetings to Raj Rajaratnam, the Galleon Group hedge fund manager and former billionaire.
Judge Rakoff said that nearly all of what Goldman requested was a ‘necessary, direct, and foreseeable result of the investigation and prosecution of Gupta's offense of conviction’.

Too many lawyers

However, he pointed out that the bank on ‘a few occasions’ had assigned too many lawyers to the case. Whilst  this was’perhaps perfectly appropriate on the assumption that Goldman Sachs wished to spare no expense on a matter of great importance ot it,’ it was more than reasonably necessary under the law, he said.
The claim was made under the Mandatory Victims Restitution Act, which allows restitution in certain fraud cases.
Gupta’s lawyer, Richard Davis, said his client plans to appeal.


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