Ex-Wachtell Lawyer Identified as Co-Conspirator in Massive Insider Trading Case

A former Wachtell, Lipton, Rosen & Katz attorney who rose to senior ranks at LionTree has been linked to a sprawling insider-trading network that federal prosecutors say turned confidential merger information into tens of millions of dollars in illegal profits. The case, unsealed in Massachusetts, charged 30 defendants in what authorities described as a decade-long scheme built on stolen information from elite law firms advising on deals.

Avi Sutton, who worked at Wachtell from 2013 to 2022 before joining LionTree in 2022, was identified as the unnamed former lawyer referenced in the indictment. The Justice Department said the scheme drew on material nonpublic information from a Massachusetts law firm and other major corporate firms involved in mergers and acquisitions, underscoring how sensitive deal work can become a source of illicit trading when confidentiality controls break down.

Federal prosecutors said 19 defendants were arrested on May 6, 2026, while two others were described as fugitives in Russia and Israel. The U.S. Attorney’s Office for the District of Massachusetts said the charges were part of a large-scale insider-trading operation that netted tens of millions of dollars. The Securities and Exchange Commission also brought a related civil case against 21 individuals over the same broad conduct.

The indictment described six victim law firms and one victim boutique investment bank under anonymized labels, including Law Firm F and Investment Bank A. Prosecutors said Investment Bank A was a boutique investment bank headquartered in New York. Wachtell confirmed it was one of the victim firms and said the person in question had left more than four years ago, adding that it cooperated with prosecutors.

LionTree said Sutton was immediately placed on leave and was no longer active at the firm. The company said there were no allegations of wrongdoing against LionTree itself. The developments have put a harsh spotlight on the gatekeepers of elite finance, where law firms, boutique banks and trading circles sit close enough to deal flow that a single leak can carry enormous value. In mergers and acquisitions, timing and secrecy often decide who wins. Prosecutors now say those rules were systematically abused for years.