Pfizer Appeals Judge’s Ruling on Insider Trading Settlement

NEW YORK (Reuters) – Pfizer (NYSE:PFE) has appealed a federal judge’s refusal to award the company $75.2 million stemming from a longstanding insider trading settlement related to billionaire Steven A. Cohen’s former hedge fund, SAC Capital Management.

The disputed funds are part of the leftover amount from SAC’s $602 million settlement in March 2013 with the U.S. Securities and Exchange Commission. This settlement concerned trades made by Mathew Martoma, an SAC unit employee who was later convicted for his actions involving pharmaceutical companies Wyeth and Elan.

Pfizer argues that it is entitled to the $75.2 million because a neurologist who provided Martoma with confidential information about a 2008 Alzheimer’s drug trial had a fiduciary duty to Wyeth, which Pfizer acquired in 2009 due to this relationship as a consultant.

However, U.S. District Judge Victor Marrero of Manhattan ruled in November that Wyeth could not be considered a victim of Martoma’s trading, thereby denying Pfizer’s claim to the leftover funds after Wyeth and Elan’s investors were compensated for their losses.

Pfizer has now appealed Marrero’s decision to the 2nd U.S. Circuit Court of Appeals in Manhattan, with the appeals process likely taking several months or more.

Steven A. Cohen has not faced criminal charges related to this case. He rebranded SAC Capital as Point72 Asset Management in 2014, and is reported by Forbes to possess a net worth of $21.3 billion.