Judge won’t block $1.8b SAC settlement

NEW YORK — A judge who has talked tough about insider trading stepped out of the way of a $1.8 billion settlement of civil and criminal charges against hedge fund giant SAC Capital on Wednesday, saying what he thinks of the deal, which carries record penalties, ‘‘is not really relevant today.’’

At a hearing in Manhattan on the civil case, US District Judge Richard J. Sullivan said that to the extent his review of the deal was needed, he believed ‘‘there is sufficient basis to approve this settlement.’’ He said he would sign the necessary paperwork involving the hedge fund owned by billionaire Steven A. Cohen.

But he added that the deal means that the need for the ‘‘court’s scrutiny is quite minimal’’ and he questioned whether he needed to approve the deal at all.


Sullivan said that is not the case for Judge Laura Taylor Swain, who will preside over a criminal proceeding Friday at which lawyers for the Stamford, Conn.-based hedge fund and related companies are expected to plead guilty to a single count of wire fraud and four counts of securities fraud.

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She will have more latitude to decide whether the plea settlement brings a satisfactory end to the case that the government brought over the summer, when US Attorney Preet Bharara said SAC Capital earned hundreds of millions of dollars illegally from 1999 to 2010 as its portfolio managers and analysts traded on inside information from at least 20 public companies.

But Sullivan said civil claims could be dismissed by agreement among the parties, absent action by the judge.

SAC will pay a $900 million fine and forfeit another $900 million, though it can exclude $616 million that SAC companies have already agreed to forfeit to settle parallel actions by the SEC.

‘‘Whether I think $1.8 billion or $900 million or $284 million is a sufficient number is not really relevant today,’’ Sullivan said.