NEW YORK (Reuters) - Presiding over the high-profile insider-trading trial and sentencing of Galleon hedge fund founder Raj Rajaratnam was “personally challenging,” says Richard Holwell, who left the federal judiciary to start a new law firm on Tuesday.
One-time high flying billionaire Rajaratnam was convicted in a sweeping jury verdict on 14 charges in federal court in New York last May. Holwell sentenced him in October to serve 11 years in prison, the longest term on record for insider trading.
“I personally found it a difficult court case because it had to be dealt with both on an individual level and, obviously, the case had implications for the financial markets and the social fabric in general,” Holwell, who is starting a litigation boutique in Manhattan with two other lawyers, said in a telephone interview.
“You couldn’t really overlook where it was and it was always a constant struggle to strike the right balance on how one approached the case. In that sense, it was personally challenging.”
Holwell, 65, was nominated by President George W. Bush and appointed to U.S. District Court in Manhattan in 2003. On Tuesday, he acknowledged it was rare for a judge appointed for life to stand down and return to private practice.
“I felt just a little itch and wanted to try and get back in the courtroom from the other side of the rail,” Holwell said.
He said he started discussions about forming a new firm in the late summer and early fall of 2011.
Holwell presided over many complex financial cases during his time as a judge. Among his notable rulings was one allowing the government’s wiretap evidence in the Rajaratnam case, but not before presiding over a special four day-long evidentiary hearing to allow Rajaratnam’s lawyers to challenge them.
One of Holwell’s last written opinions, published on Monday, was in the Rajaratnam case. It was largely a mechanical ruling describing how he used the federal sentencing guidelines to calculate the sentence.
A news release issued on behalf of Holwell and his new law partners said they would focus on complex commercial litigation. The new firm will be known as Holwell Shuster & Goldberg.
Holwell is rejoining other prominent New York-based trial lawyers Michael Shuster and Daniel Goldberg, whom he mentored at White & Case firm in New York before he became a judge. Holwell was in private practice with White & Case from 1971 until 2003.
Separately on Tuesday, a behind-the-scenes figure in the government’s crackdown on insider-trading moved from the office of the Manhattan U.S. attorney to a private law firm.
Christopher Garcia, Chief of the Securities & Commodities Fraud Task Force at the United States Attorney’s Office for the Southern District of New York, will join the firm Weil Gotshal and Manges as a litigation partner, according to a statement by the law firm.
As a prosecutor, Garcia supervised prosecutors, law enforcement agents, and staff in securities fraud investigations, trials, appeals, and other litigation, including the insider trading cases involving Galleon Group, expert network firms and hedge funds.
Reporting By Grant McCool; editing by Andre Grenon, Bernard Orr