by Brooke Cucinella, Stephen M. Cutler, Sarah L. Eichenberger, Nicholas S. Goldin, Joshua A. Levine, Michael J. Osnato, Jr., and Jonathan S. Kaplan
On January 11, 2021, based on the consent—and indeed, at the request of the Department of Justice (“DOJ”)—the Supreme Court vacated and remanded the Second Circuit’s decision in United States v. Blaszczak. Blaszczak was the controversial 2-1 decision that arguably heightened (some say unfairly) the risk of criminal insider trading prosecution by upholding the multi-count convictions of the defendants for, at bottom, illegally trading while in possession of information stolen from the government. The Supreme Court agreed, remanding to the Second Circuit to reconsider its decision in light of the Court’s intervening decision in Kelly v. United States. Kelly overturned the convictions that had stemmed from New Jersey’s infamous BridgeGate scandal by finding that, in that case, the government information at issue was not “property” as would have been required to sustain a conviction under the wire fraud theory, and that while “allocating lanes” on the bridge required “the time and labor of Port Authority employees,” those expenditures were “incidental” to “run-of-the-mine exercise of regulatory power,” rather than a misappropriation of government property.[1]