Gene Levoff, former senior director of corporate law at Apple, continues to fight insider trading charges and asked Monday that his indictment be dismissed on the grounds of constitutionality.
Gene Levoff | Source: Bloomberg
Levoff was formally charged by the United States Attorney’s Office for the District of New Jersey in October for making several stock trades based on informationon taken from early access to informationon about Apple’s earnings and revenues.
Lawyer Kevin Marino said the lawsuit is unconstitutional because Levoff’s actions are not expressly prohibited by any criminal law, reports Bloomberg.
“The definition of insider trading is entirely done by a judge: every element of the crime and the extent of the regulated individuals subject to it have been guessed by judges, not elected legislators,” said Marino in a court file. . “This alone makes criminal prosecution for insider trading unconstitutional.”
As noted by Bloomberg, the courts have failed to examine the constitutionality of a federal common law in relation to insider trading despite years of criminal charges laid in such cases.
It is unclear whether the tactic will work, as the Supreme Court dealt with a similar, albeit not identical, insider trading case in 2016. At the time, the country’s highest court did not seem to have a problem. with the constitutionality of the process.
As part of Apple’s disclosure committee, Levoff had access to the company’s financial data before the report was released. Prosecutors say he used the informationon to seek unjust enrichment through a series of beneficial stock trades that generated $ 227,000 in profits and avoided $ 377,000 in potential losses. The conduct dates back to 2011 and intersects with a blackout period linked to Apple’s broader commercial policy. Ironically, Levoff was in charge of the initiative and sometimes carried out illicit transactions after informing others of the restrictions.
Levoff faces six counts of security fraud and six counts of wire fraud, each carrying a maximum sentence of 20 years in prison. In addition, the securities fraud charges result in a fine of $ 5 million, while the wire fraud charges impose a fine of $ 250,000 or double the gain or loss arising of the offense.
Apple, in a statement to Appleiphonestop last year, said that Levoff’s indiscretions were first brought to his attention in 2018. Thorough investigation led to his dismissal the same year.
Levoff is currently on bail after being formally charged by the U.S. Securities and Exchange Commission in February 2019.