On July 8, 2014 Rengan Rajaratnam was acquitted by a federal jury of participation in an insider trading conspiracy. This was the government’s first trial loss in its insider trading investigation that has led to 85 convictions, with most defendants sentenced to prison. Raj Rajaratnam, the defendant’s older brother, is currently serving an 11 year jail term. In an earlier post http://cartelcapers.com/blog/fugitves-return-us-upon-indictment-admissible-show-consciousness-innocence/ I reported that in a pretrial motion, Rajaratnam’s counsel persuaded the court that he should be able to introduce evidence that he was in Brazil at the time he learned of his indictment and he immediately returned to the United States to face the charges. This evidence, Rajaratnam argued, and the court agreed, could be considered by the jury as “consciousness of innocence.” The jury acquitted Rajaratnam, and no doubt many factors were at play, but in fact, Rajaratnam did introduce such evidence at trial. One witness was Husseni Rasiwala, who was Rajaratnam’s roommate in Rio de Janieros when the defendant learned he had been indicted. Rasiwala testified that he was with when Rajaratnam his lawyers told him of the indictment. The defendant said: “‘I am innocent, this is about my brother, not me. I want to go back and clear my name.’” Rajaratnam then immediately began making plans to return to New York. Another friend of the defendant, Sanjay Agarwal, told jurors that Rajaratnam showed him an online news account of his indictment about that time. Rajaratnam was upset by the allegations. Agarwal testified that Rajaratnam said, ‘They are coming after me and I haven’t done anything wrong. I have to go and prove my innocence.” There is no way of knowing if this testimony carried much weight with the jury. The government’s case overall was not the strongest. Rajaratnam was initially indicted on seven counts, but the government dismissed four counts before the trial even started. After the close of evidence, Judge Naomi Reice Buchwald dismissed the two insider trading charges against him. The judge expressed concern about the one remaining count but let the jury consider simply whether the defendant had conspired with his older brother to commit insider trading. The few juror comments after the trial indicated that the jury thought there was simply not enough evidence to convict. This case caught my attention when I read about the “consciousness of innocence” evidence. When I was a prosecutor with the Antitrust Division we had many foreign fugitives in our international cartel prosecutions. It was always of some concern that one would suddenly show up and seek a quick trial. There were occasions when Interpol detained a person with a name similar or identical to one of our fugitives. These all turned out be false alarms, but were cause for a little (well, maybe a lot of) anxiety. Preparing to try an international price fixing case is no easy thing. Doing it on very short notice is a scary thought. With witnesses scattered across the globe it was always a worry whether we would get witnesses back into the US to testify and if so, what their level of cooperation would be. Seemingly simple things like getting certified translations of documents become more difficult under time pressure. Trying a complex international conspiracy in short time could prove to be quite difficult. It would of course be risky for a defendant to voluntary return to the U.S. and seek an early trial. For one thing, even a voluntary return to the U.S. may not necessarily be probative of “consciousness of innocence.” It all depends on the specific circumstances of each case. Moreover, considerations of the overall strength of the Division’s case will likely outweigh any possible benefit from a voluntary return to the U.S. And, while voluntary surrender may catch the Division by surprise, prosecutors can certainly muster the resources needed to prepare for even a complex trial. Any international cartel trial is an “all hands on deck” event for the Division. And, the lack of time to the Division to prepare applies to the defense as well. Nonetheless, the Division bears the heavy burden of proof beyond a reasonable doubt. Note: In U.S. v. AU Optronics (the TFT-LCD conspiracy) six AU Optronics executives voluntarily came from Taiwan to the U.S to face trial. In a series of trials, three of the executives were convicted and three were acquitted. Taiwan has no extradition treaty with the U.S. If any reader knows whether the defense was able to introduce evidence of the defendant’s voluntary surrender, please comment. Thanks for reading.