There will not be any new trials for 2 former ArthroCare (NSDQ:ARTC) executives, a federal judge in Texas ruled Dec. 4.
Former ArthroCare CEO Michael Baker and CFO Michael Gluk were convicted last June of running a scheme to defraud investors of more than $750 million; Baker was sentenced to 20 years in prison and Gluk drew a 10-year term.
Last month Baker argued that he’s entitled to a new trial because a court security guard excluded of members of Baker’s and Gluk’s families and the general public on the 1st day of jury selection; Gluk asked to join that motion last week. Prosecutors countered that there were, in fact, members of the public allowed into the courtroom that day, providing affidavits from 4 "members of the public who were present throughout the jury-selection process," according to court documents.
Sparks agreed, ruling that the courtroom was not closed to the public and noting that the family members were only out of the courtroom for about 2½ hours on the trial’s 1st day, according to court documents.
“To the extent the Baker and Gluk families were temporarily unable to find seating in the courtroom because the room was filed to capacity, no constitutional violation occurred; the 6th Amendment requires that trials be open to the public, not that seats must be available for every person who wishes to attend," Sparks wrote. "Here, members of the public were not excluded, the court and its personnel made efforts both to increase the amount of seating available and to accommodate those persons in the courtroom when voir dire began, and the courtroom was filled to capacity."
In May 2013, ex-executive David Applegate pleaded guilty to the fraud charges; later that month former co-worker John Raffle denied his involvement but later changed his plea to guilty. Raffle was sentenced to serve 6 years and 8 months in prison followed by 3 years of supervised release, according to a press release, while Applegate was sentenced to a 5-year term and 3 years of supervised release.
Early this year ArthroCare, which was acquired for $1.7 billion by Smith & Nephew (FTSE:SN, NYSE:SNN), agreed to pay a $30 million fine and enter a deferred prosecution deal to settle its part in the fraud case.
