Fabrice Tourre Asks For New Trial
Former Goldman Sachs Group Inc. (GS) trader Fabrice Tourre moved to reverse a federal jury's decision that found him liable for defrauding investors in a mortgage-linked deal that soured during the financial crisis.
In a motion filed Monday, Mr. Tourre asked U.S. Judge Katherine Forrest to dismiss each of the six civil counts that went against him, or order a new trial, on grounds the jury's findings were either "seriously erroneous" or weren't supported by the case the Securities and Exchange Commission had brought against him.
"The liability verdicts on the other counts are so contrary to the weight of the evidence that it would work a manifest injustice to Mr. Tourre if they were permitted to stand," Mr. Tourre's lawyers wrote in the motion.
Such post-trial motions are often unsuccessful, as they can ask judges to reverse their own rulings, but they can help reveal some of the arguments a party intends to make in a potential appeal. The filing revisited some arguments Mr. Tourre's lawyers had made during the trial, which ended in early August with a sweeping victory by the SEC.
A panel of nine jurors had found Mr. Tourre liable in six of the seven claims the SEC had brought against him. The trial, held in the federal courthouse in downtown Manhattan, captivated Wall Street and gave the outside world a glimpse of the way traders and their clients interacted as the credit markets veered toward disaster.
In Monday's motion, Mr. Tourre argued that since the jurors had concluded he didn't defraud an investor through any of the alleged misstatements presented by the SEC--this was the one count that went Mr. Tourre's way in August--they were wrong in finding him liable for participating in a scheme to defraud one of Abacus's investors.
Mr. Tourre also argued on Monday that there was no evidence that he obtained any money or property related to his work on Abacus, noting that his trading desk actually lost money on the deal.
The SEC sued Mr. Tourre along with his former employer, Goldman, in 2010 for their roles in creating and marketing a mortgage-linked deal called Abacus 2007-AC1.
Goldman settled the SEC's complaint within months, agreeing to pay a $550 million fine without admitting or denying wrongdoing. But Mr. Tourre rejected a deal from the regulator, setting the stage for his 2013 trial.
The SEC has until the end of the month to respond to Mr. Tourre's motion.
Matthew Martens, the SEC's chief litigation counsel and its lead lawyer on the Tourre case, plans to leave the agency later this month. The SEC said Friday that Mr. Martens's deputy, Matthew Solomon, would replace him as the agency's top litigator.
A spokesman for Mr. Tourre declined to comment, as did a spokesman for the SEC.
--Chad Bray and Jean Eaglesham contributed to this article.
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