SAC Capital Advisors LP was sued by
a public pension fund that holds shares of Wyeth LLC, now a unit
of Pfizer Inc. (PFE), over alleged insider trading on tips about an
Birmingham Retirement Relief System sued SAC, its
founder, Steven A. Cohen, and SAC units including CR Intrinsic
Investors LLC, claiming damages for alleged illegal trading by
the hedge fund in the drugmaker’s stock. Stamford, Connecticut-
based SAC last month agreed to pay a record $602 million to
settle insider-trading allegations filed by the Securities and
In the settlement, which must be approved by U.S. District
Judge Victor Marrero, SAC didn’t admit or deny wrongdoing.
The Birmingham fund, in its complaint filed yesterday,
seeks to represent a class of investors who bought Wyeth common
stock in 2008 from July 21 to July 29.
The U.S. charged Mathew Martoma, a former CR Intrinsic
portfolio manager, with using illegal tips to help SAC make
profits or avoid losses totaling $276 million by trading in Elan
Corp. (ELN) and Wyeth LLC. Prosecutors said the case is the biggest
insider trading scheme in history. Martoma has pleaded not
Martoma, according to a Dec. 21 indictment against him,
used tips from a physician who was in charge of monitoring the
safety of a drug undergoing clinical tests to advise an unnamed
“hedge fund owner” to trade in Elan and Wyeth stock. A person
familiar with the case said Cohen is that hedge fund owner.
In addition to the SAC units and Cohen, the complaint names
as defendants Martoma and Sidney Gilman, the doctor who
allegedly passed him the drug-trial information. The suit filed
on behalf of Wyeth shareholders follows at least two that have
been filed against SAC by holders of Elan shares.
“Any liability to these plaintiffs is fully discharged by
our settlement with the SEC, and this lawsuit presents no new
liability to SAC,” Jonathan Gasthalter, an SAC spokesman at
Sard Verbinnen Co., said yesterday in an e-mailed statement.
To contact the reporter on this story:
Bob Van Voris in New York at
To contact the editor responsible for this story:
Michael Hytha at [email protected]