On January 10, 2024, U.S. District Judge Brian Cogan declined to sentence Wilson Sonsini client and former Platinum Partners chief investment officer David Levy to prison for his conviction over a purported scheme to defraud bondholders of a Texas oil and gas company. Judge Cogan instead sentenced Levy to time served, with no term of probation, and fined him $5,000. The judgment came over four years after Levy and Platinum co-founder Mark Nordlicht were acquitted, after a 13-week jury trial, of all charges related to the government's allegations that Levy and others ran Platinum as “the largest Ponzi scheme since Bernie Madoff.” The three other counts on which Levy was convicted related to a purported $70 million fraud on the bondholders of one of the hedge fund’s controlled companies, Black Elk Energy Offshore Operations LLC.

Following the jury’s verdict, in September 2019, Judge Cogan granted Wilson Sonsini’s motion for a judgment of acquittal on the three counts of conviction against Levy. In his written decision, Judge Cogan said that even making reasonable inferences in favor of the government and deferring to the role of the jury, prosecutors failed to prove beyond a reasonable doubt that Levy had criminal intent. Those convictions were then reinstated by the Second Circuit on a government appeal. But thereafter, Judge Cogan again granted Wilson Sonsini’s motion to vacate the conviction on one of the three reinstated counts based on the Supreme Court’s recent Ciminelli decision, and thereafter, the court ruled that the supposed fraud had caused no damage to any investor, and that there was no loss and no victims.

Wilson Sonsini Goodrich & Rosati represented Levy throughout this seven-year odyssey. The firm’s team was led by Michael Sommer, Moe Fodeman, Ariel Jeong, and Zak Kravat, all based in the firm's New York office.

For more information, please see these articles from Law360 and Bloomberg News.