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Tech Bubble Figures Nacchio, Vilar Due In Court This Week
Both men played leading roles in the dot-com crash in which millions of investors lost vast sums of money.
The technology bubble of the late 1990s is behind us, but in two separate court proceedings this week the federal government will pursue two men it claims played leading roles in the technology bubble in which millions of investors lost vast sums of money.
In Denver's 10th U.S. Circuit Court of Appeals, former Qwest CEO Joseph Nacchio will seek to avoid a prison term after he was convicted of selling $52 million in stock with insider knowledge that the company was encountering trouble. In New York City, the trial of former high-tech investor Alberto Vilar is scheduled to get under way in Federal District Court.
The Nacchio case has already taken several serpentine turns beginning with his conviction in a jury trial of April 2007 of insider trading. Nacchio was charged with selling Qwest stock after he had been informed by other Qwest employees that the company's finances were falling. He was then sentenced to six years in prison and ordered to pay a multimillion-dollar penalty.
But in March, a three-judge panel ordered a new trial. Nacchio's attorneys based much of his defense on a claim that evidence and expert testimony had been withheld that showed that Qwest didn't participate in work for the National Security Agency and that the evidence and expert testimony would bolster Nacchio's case.
This week prosecutors have signaled they will argue that Nacchio's conviction should be upheld. Nacchio, who has always maintained his innocence, wants the reversal of the jury verdict to remain in force.
As for Vilar, he, too, maintains his innocence in charges that he defrauded customers in his once high-flying Amerindo Investment Advisors. At one point, according to media reports, his fund was worth $9 billion and he was worth nearly $1 billion. A patron of the arts, Vilar contributed millions to the Metropolitan Opera and various art and cultural organizations. "We were the first investors in probably 15 household tech companies that made it," Vilar told The New York Times.
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