Supreme Court orders 2nd Circ to revisit hedge fund insider trading case

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The U.S. Supreme Court ordered a federal appeals court in New York on Monday to rethink its ruling upholding the convictions of two former Deerfield Management Co LP partners over a scheme to trade on leaks about pending healthcare regulatory changes in the United States.

The Supreme Court said the 2nd U.S. Circuit Court of Appeals should review its 2019 decision holding that non-public information from the U.S. Centers for Medicare and Medicaid Services (CMS) was property under a federal securities fraud statute, in light of the high court’s ruling last year in the “Bridgegate” case limiting how prosecutors can use property fraud statutes to go after government-related schemes.

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