Mathew Martoma, the former SAC portfolio manager facing insider trading charges, has switched lawyers, replacing Charles A. Stillman of Stillman & Friedman, with Richard M. Strassberg of Goodwin Procter.
The move is likely to fuel speculation about whether Mr. Martoma, who has denied the charges and refused to cooperate with the government, will change his plea and help prosecutors build a case against his former boss, Steven A. Cohen, the owner of SAC.
But several white-collar criminal defense lawyers said that it was difficult to ascertain Mr. Martoma’s intentions in changing counsel. If anything, they say, Mr. Martoma’s hiring of Mr. Strassberg â€" a seasoned trial lawyer with several high-profile courtroom victories â€" indicates that Mr. Martoma intends to have his case heard by a jury.
“Hiring Rich would suggest that he plans to go the distance,†said a white-collar criminal defense lawyer who spoke only on the condition of anonymity.
Mr. Stillman confirmed that he had been replaced by Goodwin Procter. He said in a one-sentence e-mailed statement: “We wish Mathew Martoma all the best.â€
In December, federal prosecutors indicted Mr. Martoma and charged him with making more than $276 million in a combination of illegal profits and avoided losses by obtaining secret information from a doctor about clinical trials for an Alzheimer’s drug being developed by the companies Elan and Wyeth.
For the first time in the government’s investigation of insider trading at SAC, the trades at the center of the Martoma case directly involve Mr. Cohen. According to the government, Mr. Martoma and Mr. Cohen had a 20-minute telephone conversation the night before SAC started illegally trading shares of Elan and Wyeth.
SAC last month paid $602 million to settled civil charges related to the trades. As part of the settlement it neither admitted nor denied wrongdoing. Mr. Cohen has not been charged with any wrongdoing and has said he believes he has at all times behaved appropriately.
The decision by Mr. Martoma to switch lawyers was something of a surprise. Mr. Stillman, who runs a 14-lawyer criminal defense boutique, is a renowned trial lawyer and considered one of the deans of New York’s white-collar criminal defense bar. In Goodwin Procter, Mr. Martoma has retained a much larger firm. The venerable, century-old firm, started in Boston, now has 800 lawyers with offices across the world.
Mr. Strassberg, 49, a former federal prosecutor, has had a number of significant victories representing white-collar criminal defendants. In 2010, he successfully defended Jon Paul Rorech, a former trader at Deustche Bank, against civil charges brought by the Securities and Exchange Commission in the first-ever insider trading trial involving credit default swaps. He represented David Greenberg, a former partner at the accounting firm of KPMG charged with criminal tax-fraud violations. After a nearly three-month trial, a jury acquired Mr. Greenberg while convicting all of the othe defendants in the case.
Most recently, Mr. Strassberg represented the Swiss bank Wegelin, which pleaded guilty in January to helping American dodge taxes. And in perhaps his highest profile case, he was the trial lawyer for Martha Stewart‘s stockbroker Peter Bacanovic, who served five months in prison after his conviction on charges related to Ms. Stewart’s stock trading.
Mr. Strassberg declined to comment beyond confirming his representation of Mr. Martoma. In addition to Mr. Strassberg, Mr. Martoma’s team at Goodwin is expected to include Roberto M. Braceras, John O. Farley, and Daniel P. Roeser.
