Steve Cohen just scored a victory in his battle with the SEC

The Securities and Exchange Commission has dropped a portion of its civil case against SAC Capital founder Steve Cohen.

In a joint statement on Monday December 21, the SEC's division of enforcement and Cohen's lawyers said that the agency's division of enforcement is abandoning its case relating to Cohen's failure to supervise former SAC trader Michael Steinberg.

Steinberg's own case was overturned this fall.

The SEC still maintains that Cohen failed to supervise Matthew Martoma, another trader who was convicted of insider trading and sentenced to nearly a decade in prison. Martoma sought to have his appeal overturned earlier this year. The appeal is still to be heard.

The convictions of the two men helped the SEC levy a $300 million fine against Cohen for failing to supervise Martoma and Steinberg, and separately push Cohen to a $1.8 billion settlement that barred him from managing outside investor funds.

Cohen now leads Point72 Asset Management, which invests the money of Cohen and his colleagues.

If the federal government has to abandon both failure to supervise counts against Cohen, it could open the door to him reclaiming hundreds of millions of dollars he was fined, and possibly even allow him to again manage outside capital, according to one former prosecutor.

Still, Cohen has a long way to go until he can reclaim everything he has lost to the federal government, the ex-prosecutor said.

"We are light years away from Steve Cohen being able to get his money back," he said.

Another blow

For the federal government it is yet another blow to the once-undefeated track record of US Attorney Preet Bharara, the Department of Justice's top lawyer policing Wall Street.

The SEC previously lost an appeal against the overturned convictions of two other traders outside of SAC, with that decision creating an important precedent for insider trading cases: that each party in the trade received a 'benefit' from the illegal insider trading.

A new hearing schedule will allow Cohen's lawyers to challenge the amended case's premise in April 2016, according to the ex-prosecutor.