Shapiro Arato Bach Wins Supreme Court Ruling Vacating Second Circuit Insider Trading Decision
On January 11, 2021, the Supreme Court of the United States granted the petition for a writ of certiorari that Shapiro Arato Bach filed on behalf of our client, Theodore Huber, and vacated a lower court decision that had affirmed his criminal convictions. The case arises out of securities trades that Huber’s firm made based on information about a federal agency’s contemplated changes to Medicare reimbursement rates. In its Supreme Court petition, Shapiro Arato Bach argued, among other things, that the government’s interest in such predecisional information is purely regulatory, not proprietary, and thus cannot support Huber’s conviction under the federal fraud and conversion statutes. Indeed, after the Second Circuit Court of Appeals affirmed Huber’s convictions, the Supreme Court issued its unanimous decision in the “Bridgegate” case, Kelly v. United States, 590 U.S. — (2020), which vacated fraud convictions on the ground that fraud must involve “property,” and so encroachments on governmental regulatory powers do not suffice. Even the government conceded that Kelly required vacating Huber’s convictions. The Supreme Court’s January 11, 2021, order granted Huber’s petition, vacated the Second Circuit’s judgment, and remanded the case for further consideration in light of Kelly.
Alexandra Shapiro, Eric Olney, and Daniel O’Neill co-authored the petition for certiorari and reply together with counsel for Huber’s co-defendant, Robert Olan. The petition and reply are available here and here.