The United States Court of Appeals for the Third Circuit reaffirmed an earlier decision that essentially overturned the convictions of former Wilmington Trust President Robert V.A. Harra, Jr. and associates.
The court rejected the government’s attempt to overturn the court’s earlier unanimous decision that reversed a criminal jury conviction in the first criminal case against a financial institution that received funds from the Troubled Asset Relief Program (TARP) following the 2008 financial crisis.
In its decision, the court held that, given the evidence and the law, “no rational jury” could have found any of the defendants guilty of 16 of the counts against them, according to a release from defense attorneys. The remaining two counts were remanded to the District Court for a new trial.
In its original precedential decision issued on January 12, the Third Circuit unanimously overturned the government’s argument that Wilmington Trust’s executives misled regulators and investors by not reporting certain commercial real estate loans as “past due” to the Securities and Exchange Commission and the Federal Reserve.
Lawyers for the firm of McCarter & English argued that the reporting requirements at issue were ambiguous and that under a reasonable interpretation of the requirements, Wilmington Trust’s omission of the loans was proper.
The McCarter team representing Harra was led by Chairman Emeritus Mike Kelly and included partners Geoffrey Rosamond and Steve Wood and associate Michele Vanderstreet.
Charges were brought after Wilmington Trust saw its stock price plunge on news of the loan problems.
New owner M&T purchased the bank and trust company for $300 million, a fraction of the previous stock price.
M&T agreed to fines in return for charges being dropped against it.
Hundreds of layoffs followed the acquisition by M&T.
