Gupta lawyers argue traders bragged falsely Lawyers for Rajat Gupta, the former director of Procter & Gamble accused of insider trading, have suggested traders at Galleon hedge fund falsely bragged about having company insiders as sources of confidential information. The suggestion was made during the cross-examination of Michael Cardillo, a former Galleon portfolio manager who previously testified he traded shares of JM Smucker after RK Rajaratnam, a colleague, told him of the receipt of a tip from "Raj's guy" at P&G. Mr Gupta is accused of telling Raj Rajaratnam, RK's brother as well as Mr Gupta's former friend and business partner, that P&G was selling its coffee business to JM Smucker shortly after the P&G board approved the transaction. Mr Gupta has denied wrongdoing. Gary Naftalis, Mr Gupta's attorney, suggested Galleon traders inflated their access to insiders, seeking to undercut the link to Mr Gupta. Mr Naftalis asked Mr Cardillo if he recalled Mr Rajaratnam saying his brother RK, who once worked for Kraft, should go to Irene Rosenfeld, the group's chief executive, to find out if it would buy Cadbury. Mr Cardillo said: "I never found that feasible." Mr Naftalis asked whether he remembered hearing that Raj Rajaratnam was giving confidential information about Intel's earnings to George Soros. Mr Cardillo said he remembered "something about Intel and Soros. I don't remember Raj being involved. Neither Ms Rosenfeld nor Mr Soros have been accused of any wrongdoing. When asked by Mr Naftalis whether he perceived anyone at Galleon to be exaggerating sources of information, Mr Cardillo said, "There were rare occassions when that happened." The testimony, which came during the second week of the trial, was the most useful to Mr Gupta so far. His lawyer caught a break and was able to show the jury analyst reports speculating that P&G might need to revise lower its organic growth forecasts. Mr Gupta is accused of calling Mr Rajaratnam after a January 29, 2009, P&G board meeting and relaying that it would lower its organic sales forecast. After the first analyst report was introduced without objection from the government, however, Judge Jed Rakoff said, "I'll give a short tutorial at the end of the day on the rules of evidence." Mr Naftalis showed the jury several reports from December 2008 and January 2009 in which stock analysts said they believed the consumer group might soften its organic sales forecast Prosecutors objected to the second analyst's report but not the first, causing Judge Rakoff to tell them they had "waived" their right to keep the reports out of evidence. The jury was excused from the courtroom, when tensions between the two sides showed through. Reed Brodsky, a prosecutor, said Mr Naftalis had given the thumbs up to his legal team after a line of questioning, and was also heard saying "got him," when Mr Cardillo couldn't remember which stocks he had pleaded guilty to trading illegally. Mr Naftalis countered that prosecutors had objected improperly, prompting Mr Brodsky to raise another issue. Judge Rakoff remarked that the counterparts were "down to a polite form of name calling" and ordered both sides to lunch.