Andrew Left Wants Conviction Tossed After Revelation About Witness

A witness who testified towards Andrew Left has himself turn into concerned in an insider buying and selling probe, bringing a brand new twist to the bombastic short-seller’s fraud conviction.

Left’s attorneys this month requested the decide who oversaw his trial to toss the jury’s verdict convicting him of 13 counts of securities fraud. The trial was irredeemably unfair, they stated, as a result of they by no means had the possibility to ask the witness concerning the investigation and assault his credibility.

“A brand new trial would most likely produce an acquittal,” Left’s attorneys wrote.

In June, a federal jury in Los Angeles found Left guilty of 13 counts of securities fraud. Prosecutors said he deceived investors through the use of social media and analysis stories to set goal costs for shares — together with Tesla, Nvidia, and Palantir — whereas quietly buying and selling them at completely different costs together with his personal cash.

The founding father of Citron Research, Left is one thing of a short-seller superstar. He positioned bets against GameStop on the identical time it turned a meme inventory, which pitted him towards some retail merchants on social media. For years, he was a fixture on CNBC and Bloomberg, the place he shared his views on inventory costs.

Left hasn’t been sentenced. In addition to the felony case, he faces a parallel civil lawsuit from the Securities and Exchange Commission that is still unresolved.

Left’s felony conviction shook certain corners of Wall Street, which considered the trial as a referendum on free speech and the legality of activist short-seller techniques. Left, testifying in his own defense at the trial, stated that the views he shared about public firms had been honest.

One of the trial’s prosecution witnesses was Daniel Bachus, the CFO of Grand Canyon Education, a publicly traded know-how firm that gives companies to universities. Left’s attorneys say that Bachus was the one witness who testified that Left used his Citron Research stories to lie about an organization, not merely omit info.

On August 21 — weeks after the trial ended — Grand Canyon Education positioned Bachus on paid administrative go away “in reference to an ongoing governmental investigation” involving a non-employee’s trades of the corporate’s inventory, the corporate stated in an SEC disclosure. The prosecutors in Left’s case referred to it in their very own filings as an “insider buying and selling investigation.”

No authorities company has publicly accused Bachus or Grand Canyon Education of any misconduct in reference to the investigation. In the SEC disclosure, the corporate stated it wasn’t the main target of the investigation. Representatives for the SEC and for Grand Canyon Education declined to remark. Bachus did not reply to Business Insider’s requests for remark.

Left’s attorneys say they need to have been knowledgeable concerning the investigation on the time of the trial in order that they may cross-examine Bachus and attempt to persuade the jury that he wasn’t a reputable witness.

“This proof would have destroyed the credibility of the federal government’s solely false-statements witness,” they wrote in a submitting.

The prosecution staff instructed Left’s attorneys it did not be taught concerning the investigation till after the trial was over. It’s not clear which authorities company opened the investigation, nor when Bachus or Grand Canyon Education turned conscious of it. Many of the filings concerning the difficulty remained sealed or redacted on the court docket docket for Left’s case.

In court docket filings, Justice Department prosecutors stated Left’s attorneys overstated Bachus’ function within the short-selling case, which alleged securities fraud involving greater than a dozen completely different public firms. They stated Left wished to conduct “his personal shadow investigation into Bachus” to attempt to discredit him as a witness.

“The regulation doesn’t allow fishing expeditions seeking a declare,” prosecutors stated.

Left declined to remark. Left’s legal professional Eric S. Rosen stated he couldn’t remark as a result of many related paperwork remained beneath seal.

A spokesperson for the US Attorney’s workplace in Los Angeles declined to remark.