NEW YORK (Reuters) – A corporate lawyer and a trader were charged Wednesday with running a 17-year conspiracy to trade on corporate merger secrets stolen from three of the nation’s most prominent law firms, in one of the largest U.S. insider trading cases on record.
Matthew H. Kluger, who until last month was a lawyer at Wilson Sonsini Goodrich Rosati PC, and the trader Garrett D. Bauer were accused of reaping more than $32.2 million of illicit profit by trading on tips about upcoming mergers and acquisitions.
In a complaint filed with the federal court in Newark, New Jersey, prosecutors said Kluger, 50, passed tips to an unnamed co-conspirator about mergers such as Oracle Corp’s takeover of Sun Microsystems Inc and Adobe Systems Inc’s takeover of Omniture Inc.
The co-conspirator would then tip Bauer, 43, who would make trades for all three of them based on the inside information, prosecutors said. Kluger also passed tips from his earlier jobs at Cravath Swaine Moore LLP and Skadden, Arps, Slate, Meagher Flom LLP, they added.
“According to the complaint, the defendants exploited Kluger’s access to sensitive, confidential information to make trading profits a sure thing,” U.S. Attorney Paul Fishman in New Jersey said.
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