The Justice Department is not giving up on its recent insider trading convictions without a fight. On Thursday of this week, the Justice Dept asked the Supreme Court to review a federal appellate court’s ruling that prosecutors and the SEC say severely limits their ability to get convictions on insider trading cases.

U.S. Solicitor General Donald Verrilli filed a petition with the Supreme Court seeking review of a ruling by the 2nd U.S. Circuit Court of Appeals in New York late last year that reversed the insider trading convictions of two hedge fund managers.

Legal analysts had commented that the appeals court ruling was a clear setback for the federal insider trading crackdown that had been going on since 2009 under U.S. Attorney Preet Bharara, whose term in office saw securities-related charges brought against 96 individuals.

Justice Dept Asks Supreme Court To Review Insider Trading Case

Details on earlier appeals court decision overturning insider trading convictions

In the earlier appeals court ruling, a three-judge panel determined that prosecutors must definitively prove that a trader knew a tipster’s source received something in exchange for it to be “insider trading”.

That kind of nit-picking expectation by the court will make it much more difficult to get convictions against traders who heard the information from someone besides the original tipper as it means prosecutors will need to present evidence about the trader’s knowledge of the benefit received by the original source.

Of note, the December appeals court ruling reversed the 2012 convictions of Todd Newman, an ex-Diamondback Capital Management portfolio manager, and Anthony Chiasson, co-founder of Level Global Investors, who were sentenced to several years in jail for a series of trades involving insider tips about Dell and Nvidia Corp.

Excerpt from petition by Solicitor General

In his petition to the Supreme Court on behalf of the Justice Dept, Verrilli argued that the earlier appeals court decision will “hurt market participants, disadvantage scrupulous market analysts, and impair the government’s ability to protect the fairness and integrity of the securities markets.”