NY court agrees to rehear Ex-Goldman board member's appeal

A federal appeals court agreed on Thursday to rehear the appeal of the insider-trading conviction of a former board member for Goldman Sachs and Proctor & Gamble.

The 2nd U.S. Circuit Court of Appeals in Manhattan said in a one-page order that it will rehear the claims of Rajat Gupta. His lawyers said his 2012 conviction on conspiracy and securities fraud charges should be tossed because he was innocent and the jury at his trial was improperly instructed.

"We are pleased with the court's ruling and believe we have meritorious issues to present to the court of appeals," defense attorney Gary Naftalis said.

Gupta, 57, is confined to his Westport, Connecticut, home and won't be finished serving a two-year prison sentence until next month.

A spokeswoman for federal prosecutors declined to comment.

Gupta was convicted on charges that he fed tips about Goldman to one-time billionaire hedge fund owner Raj Rajaratnam, who is serving an 11-year prison sentence after his 2011 conviction on insider-trading charges. Gupta and Rajaratnam were the most prominent people rounded up in the government's crackdown on insider trading.