Two Hedge Fund Managers In A High-Profile Insider Trading Case Just Got Their Convictions Tossed

"Because the Government failed to present sufficient evidence that the defendants willfully engaged in substantive insider trading or a conspiracy to commit insider trading in violation of the federal securities laws, we reverse Newman and Chiasson's convictions and remand with instructions to dismiss the indictment as it pertains to them with prejudice," the opinion said.

Newman, an ex-Diamondback Capital portfolio manager, and Chiasson, the co-founder of now-defunct hedge fund Level Global, were co-defendants accused of trading on inside information in Dell and Nvidia stocks. The two hedge funders were convicted in May 2013.

Today's court decision concluded that the "jury instructions were erroneous and that there was insufficient evidence to support the convictions" of Newman and Chiasson.

"Today's decision is a resounding victory for the rule of law and for Anthony Chiasson personally. Mr. Chiasson has always conducted himself according to the highest ethical and professional standards in service to many of the world's leading hedge fund investors who were his clients for years. He is deeply gratified that the decision issued today unequivocally re-establishes his innocence under the law - consistent with what Anthony has steadfastly maintained for the duration of this ordeal," Chiasson's attorney Gregory Morvillo said in a statement.

Well, the U.S. Attorney Preet Bharara, who has been cracking down on insider trading since 2009, probably isn't going to like this.

Here's the appellate court's opinion:

Appeal from the United States District Court-- Newman and Chiasson