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by Mike Caswell

A U.S. federal judge has imposed a 40-month jail term on Ross Haghighat, one of those charged for insider trading in Vancouver-Seattle biopharmaceutical listing Chinook Therapeutics Inc. ahead of a takeover. Prosecutors claimed that Mr. Haghighat, 62, tipped others in a scheme that generated $600,000 in gains from a $3.2-billion takeover offer made by Novartis AG. (All figures are in U.S. dollars.) He learned about the takeover through board meetings, the government said.

Mr. Haghighat received his sentence in an appearance before a federal judge in New Jersey on Tuesday, June 23. In addition to the 40 months in prison, the judge ordered Mr. Haghighat to serve three years of supervised release. On top of that, he must pay a $1-million fine.

Also sentenced Tuesday was Mr. Haghighat's stepdaughter, Kristyn Pearl, who must serve six months. The government claimed that Ms. Pearl, a resident of Puerto Rico, received an "illicit gift of confidential [information]" from Mr. Haghighat. She then bought out-of-the-money options designed to profit from the takeover. In addition to the six months in prison, the judge ordered Ms. Pearl to serve two years of supervised release. She must surrender herself to prison authorities by Sept. 23, 2026.

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