US court to hear Gupta's appeal on expedited basis

India-born former Goldman Sachs director Rajat Gupta's appeal against his conviction on insider trading charges will be taken up on an 'expedited' basis by a US court, which said it will hear arguments in the case as early as April next year.

The US Court of Appeals for the Second Circuit in New York said that briefs by Gupta on his appeal should be filed by January 18 next year while the government's motion should be submitted in court by March 15.

Gupta, 64, would then have time till March 29 to reply to the government's motion after which a two-judge panel of Jose Cabranes and Reena Raggi in the appeals court would hear oral arguments in the case 'on or after the week of April 1'.

"On a review of the record, it is hereby ordered that the conditions of release established by the District Court shall remain in full force and effect during the pendency of this appeal and the appeal will be expedited," the court's order said.

It said pending ruling on Gupta's appeal, any questions regarding bond and conditions of release should be referred to the two-judge panel.

Gupta was set to begin his two-year prison term on January 8 after being convicted this summer of passing confidential boardroom information in 2008 about Goldman Sachs to his friend and business associate, Sri Lankan hedge fund founder Raj Rajaratnam.

However, earlier this week, the former McKinsey head won a major reprieve after the appeals court granted his request to stay his surrender to prison and remain free on a $10 million-bond while he fights his conviction.

Gupta was arrested and charged in October last year with securities fraud and conspiracy. His bail conditions, apart from the $10 million-bond, required him to surrender his passport and imposed travel restrictions on him.

The prosecutors had been opposing Gupta's bid to stay free on bail saying he is a flight risk due to his strong financial and personal ties to his native India.

In appealing his conviction, Gupta's lawyers are expected to argue that the US District Court, which had handed down a two-year prison sentence to their client, was wrong in allowing at the trial wiretapped conversations between Rajaratnam and Singapore-based portfolio manager at Galleon David Lau.

In the conversation, Rajaratnam tells Lau that he had information about Goldman's stock position 'from somebody who is on the board of Goldman Sachs'.

Gupta's lawyers said there was no evidence that Lau had ever traded in Goldman stock and that Gupta was never a participant in these calls.

They also are expected to present the case that the court erred by excluding as hearsay critical evidence that Gupta's eldest daughter Geetanjali could have provided at trial regarding Gupta's state of mind and about her father's deteriorating relationship with Rajaratnam.

The other argument on which Gupta's case for appeal would be based is that the District Court erred by excluding wiretap evidence of an alternative Goldman Sachs tipper who provided inside information to Rajaratnam.

Gupta's lawyers have said the appeal would 'raise substantial questions and a favourable decision is likely to result in reversal (of conviction) or new trial.'

Image: Rajat Gupta