A Ruston dentist whose brother-in-law worked at the Shaw Group in 2012 was acquitted Thursday on federal insider trading charges relating to the announcement that year that Shaw was being acquired by Chicago Bridge & Iron Co. for $3 billion.
Federal prosecutors had alleged that Jesse H. Roberts III reaped a $700,000 profit from confidential information allegedly provided by his brother-in-law, Scott David Zeringue.
A north Louisiana dentist used an illegal inside scoop from a Shaw Group vice president, who…
Roberts was found not guilty on one count each of securities fraud and conspiracy to commit securities fraud. He did not testify in his own defense. The jury deliberated for about eight hours Thursday. The trial began last week.
"Jesse and his family have been through a horrible ordeal. They feel blessed and thankful that the jury considered all the evidence and reached a just verdict," Roberts' lead attorney, former federal prosecutor Shaun Clarke, said outside U.S. District Judge John deGravelles' courtroom shortly after the judge read the unanimous verdicts to a packed courtroom.
Zeringue was vice president of construction operations for Shaw when he claims to have passed confidential information to Roberts in July 2012 about the impending sale of the Baton Rouge-based engineering and construction firm. The sale was publicly announced July 30, 2012, causing Shaw's stock to soar.
Zeringue pleaded guilty in 2014 to securities fraud conspiracy and is waiting to be sentenced. He testified last week that he shared secret information with Roberts that Zeringue's boss had passed on to him.
A convicted former Shaw Group executive testified Thursday he tipped off his brother-in-law …
In his closing argument Wednesday to the 12-person jury, Clarke called Zeringue a government "hostage" who lied to the FBI
"He's a scared little man … who knows that the only way to stay out of prison is to make them (prosecutors) happy," he said. "Scott Zeringue is looking out for No. 1."
Federal prosecutors alleged Roberts used inside information to invest in Shaw stock options several times in July 2012 prior to the public announcement.
"The jury has rendered its verdict and we accept it," acting U.S. Attorney Corey Amundson, who was in the courtroom when the verdicts were announced, said afterward. "We will nevertheless continue to pursue complex white collar crimes whenever we believe sufficient evidence exists to do so."
Roberts' attorneys argued the information about the planned sale of Shaw to CB&I had been leaking out and that Roberts, an experienced trader, used information available to the public to invest in Shaw stock options and hit it big.
A Ruston dentist's July 2012 stock option trading involving the Baton Rouge-based Shaw Group…
"This was not a rumor" that Roberts acted on, Assistant U.S. Attorney Chris Dippel told the jury Wednesday. "This was not just talk around the coffee machine or water cooler."
Dippel described the actions of Zeringue and Roberts as a "partnership in crime."
Clarke acknowledged to the jury that Roberts "hit the jackpot" but said "hitting the jackpot is not a crime."
Zeringue admitted in court that he bought Shaw stock, using his company computer in his Essen Lane office at Shaw headquarters, after learning from his boss that a sale was imminent. Zeringue also said he asked Roberts to buy $5,000 in Shaw stock for him prior to the July 2012 announcement.
Zeringue testified Roberts came to Baton Rouge in November 2013 and handed him $30,000 in cash in the driveway of Zeringue's home. Roberts' attorneys have called the cash a gift.
Roberts allegedly told another Ruston resident, Billy J. Adcox Jr., about the information he received from Zeringue. Adcox was indicted in 2015 and is awaiting trial, accused of turning a $37,000 profit from his alleged insider trading activities.
Adcox's attorney, Marci Blaize, said she hopes federal prosecutors will reassess their position against her client in light of Roberts' acquittal.
"Any favorable outcome for Dr. Roberts is favorable for Billy Adcox," she added.
Three other people, including former Shaw Group employee Kelly Liu, were indicted last month and accused of insider trading and illegally profiting from Shaw's sale to CB&I.