Federal Judge Grants Platinum Partners Co-Founder New Trial

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A federal jury in July found Mark Nordlicht, co-founder of defunct hedge fund Platinum Partners, guilty of securities fraud, conspiracy to commit securities fraud and conspiracy to commit wire fraud.


Photo:

mike segar/Reuters

A federal judge in New York on Friday granted a new trial to

Mark Nordlicht,

the co-founder of defunct hedge fund Platinum Partners who was convicted of fraud earlier this year.

Whether Mr. Nordlicht is tried for a second time depends on if prosecutors from the Eastern District of New York decide to retry the case. A spokesman said the office was reviewing the judge’s decision.

A lawyer for Mr. Nordlicht said his client was ecstatic about the ruling. “These charges were nothing short of outrageous to begin with,” said the lawyer, Jose Baez.

Following a trial of nearly three months, a federal jury in July found Mr. Nordlicht and David Levy, Platinum’s co-chief investment officer, guilty of securities fraud, conspiracy to commit securities fraud and conspiracy to commit wire fraud. The conviction stemmed from an alleged scheme to rig a bondholder vote.

The jury acquitted the two men of a second alleged scheme in which prosecutors accused the executives of concealing problems about the fund from its investors.

A third Platinum executive was acquitted of all charges.

In his ruling, U.S. District Judge Brian Cogan said prosecutors didn’t present sufficient evidence to prove Mr. Nordlicht’s guilt. “Letting the verdict stand against Nordlicht would be a manifest injustice,” the judge wrote.

In addition to granting Mr. Nordlicht a new trial, Judge Cogan acquitted Mr. Levy.

Lawyers for Mr. Levy said, “While he suffered enormously over the past three years, he can now reclaim his life and move beyond this misguided prosecution.”

Write to Corinne Ramey at [email protected]

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