Alison Frankel cites the defendants briefs before the SCOTUS:
In at least eight post-Newman decisions, federal district judges have rejected insider trading defendants’ arguments that the government failed to show a tipster received a personal benefit, according to the Newman and Chiasson briefs. Only one defendant, Thomas Conradt, managed to secure the dismissal of the criminal case against him – and the judge in that case cited both the 2nd Circuit’s definition of a personal benefit and its requirement that the defendant be aware of a benefit to the tipster.
Moreover, all of the district courts to have addressed the post-Newman personal benefit question have found the 2nd Circuit is in accord with the Supreme Court’s precedent in Dirks, according to Newman and Chiasson. Even the 9th Circuit’s recent decision in U.S. v. Salman– the ruling that supposedly creates a split between the 2nd and 9th Circuits on the definition of a personal benefit – said the 2nd Circuit “recognized that the personal benefit is broadly defined to include not only pecuniary gain but also the benefit one would obtain from simply making a gift of confidential information to a trading relative or friend.” If the Salman case had been on appeal at the 2nd Circuit, Newman and Chiasson said, the result would have been the same as it was in the 9th: The court would have affirmed the conviction of a trader who profited from information passed between brothers because brotherhood establishes the tipster’s personal benefit.
