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January 14, 2011 7:15 PM

Ex-Ropes & Gray Associate Pleads Guilty to Insider Trading

Posted by Ed Shanahan

From the New York Law Journal

Arthur Cutillo, 34, a former Ropes & Gray IP associate who had been charged in the Galleon Group insider trading case, pleaded guilty on Friday to insider trading and conspiracy charges.

Cutillo admitted conspiracy and fraud today in federal court in Manhattan. He told Southern District judge Richard J. Sullivan that he and fellow Ropes & Gray attorney Brien Santarlas in 2007 passed information on the upcoming acquisitions of 3Com Corp. and Acxan Pharma Inc. to Cutillo's old college roommate, Jason Goldfarb, then an attorney with personal injury firm Brecher Fishman Pasternal Walsh Tilker & Zeigler.

In turn, Goldfarb passed the information to broker-dealer Zvi Goffer, allegedly dubbed "Octopussy" by his coconspirators because his scheme reached into so many companies.

Cutillo was arrested in 2009 as part of a broader probe into insider trading centering on the Galleon Group hedge fund scandal. Santarlas pleaded guilty to conspiracy and securities fraud in 2009.

On Friday, Cutillo told Judge Sullivan that Goldfarb asked him several times if he could provide inside information from his position at the firm and "to my everlasting regret and shame, I agreed." Cutillo said he knew he was violating firm policy on handling confidential client information and his fiduciary duty to the firm. "I would like to sincerely apologize to everyone who has been harmed by my actions," he said. "I let myself down as well as my family, my friends, and my colleagues."

Assistant U.S. attorney Andrew Fish spoke for the government. Catherine Redlich of Driscoll & Redlich represents Cutillo, who faces maximum sentences of five years on the conspiracy charge and 20 years on the insider trading charge when he is sentenced by Judge Sullivan on April 27.

--Mark Hamblett

Note: Ropes & Gray did not immediately respond to a request for comment by The Am Law Daily. We will update this post with that information if and when we receive it.

 

RELATED STORIES

Another Guilty Plea in Galleon
The New York Times

Ex-Ropes & Gray Lawyer Cutillo Pleads Guilty In Insider Case
The Wall Street Journal

 

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