Greenberg Traurig Secures Reversal of Criminal Conviction for Former ArthroCare Executive

Jan. 27, 2015 – A team comprised of White Collar Criminal Defense and Appellate Practice Group attorneys at international law firm Greenberg Traurig, P.A. recently secured a rare criminal conviction reversal for the former chief financial officer of medical device maker ArthroCare Corp.

The Fifth Circuit Court of Appeals agreed with Greenberg Traurig’s arguments that former ArthroCare CFO Michael Gluk was denied a fair trial. In June 2014, after a month long trial, Gluk was convicted in a $750 million securities fraud case in the Western District of Texas for his alleged involvement in “channel-stuffing,” a practice of attempting to prop up the Austin-based ArthroCare’s stock price by inflating sales to distributors in a series of quarter-end transactions.

The Fifth Circuit held that the district court erred in refusing to allow the introduction of  key defense evidence and in allowing the introduction of inadmissible evidence by the government. The court overturned the district court’s exclusion of the results of an investigation by the Securities Exchange Commission, which found no wrongdoing by Gluk. The court also questioned the decision to allow the government to bring unrelated allegations of health care fraud by an ArthroCare customer into the trial. The court ordered a new trial.

“We are gratified by the Fifth Circuit's decision,” said Elliot H. Scherker, Co-Chair of Greenberg Traurig’s Appellate Practice. “We truly believe that Mr. Gluk did not receive a fair trial, and the court's decision has resoundingly held in his favor.”

Scherker led the appellate team and was supported by Shareholder Brigid F. Cech Samole and Associate Jay A. Yagoda of the firm’s Miami office.

Gluk was represented at the original trial by Greenberg Traurig Dallas Litigation Shareholders David W. Klaudt and Jason S. Lewis, who also served on the appellate team.

“We are elated for Mr. Gluk and his family, who have endured so much over the past several years,” Lewis said. “The ruling vindicated our position through trial that the erroneous exclusion of critical evidence offered in Mr. Gluk’s defense and the equally erroneous admission of irrelevant evidence unfairly prejudiced Mr. Gluk and his right to a fair trial.”

The Fifth Circuit Court also overturned the conviction of former ArthroCare chief executive officer Michael Baker.