Rajat Gupta, the former Goldman Sachs director, may file a suit claiming the Securities and Exchange Commission violated his rights when it filed an administrative action accusing him of passing illegal stock tips and thereby denying him a jury trial, reports said.

The SEC launched administrative proceedings against Rajat Gupta on March 1 accusing him of passing information to Galleon Group LLC co-founder Raj Rajaratnam about Goldman Sachs and Procter & Gamble Co., where Gupta was once a director. Reuters reports that the information included alleged details of financial results and a $5 billion investment by Warren Buffett's Berkshire Hathaway Inc in Goldman Sachs at the peak of the financial crisis.

US District Judge Jed Rakoff ruled that Gupta, who faces no criminal charges, may argue that the SEC deliberately singled him out for unjust treatment.  Rakoff added that all other suits in the Galleon case against 21 people and 7 companies are in the Federal Court.

We have the unusual case where there is already a well developed public record of Gupta being treated substantially disparately from 28 essentially identical defendants, with not even a hint from the SEC, even in their instant papers, as to why this should be so, Rakoff wrote.

The Federal Court offers certain protections like the rights to have a jury trial, obtain some evidence and raise counter-claims which are not available in administrative proceedings.

The allegations of unequal treatment, if made properly, would state a claim even if Gupta were entirely guilty of the charges made against him, Rakoff added.

The SEC typically tries insider-trading defendants in a Federal Court. However, the Dodd-Frank financial reform bill passed in July last year empowers the SEC to seek monetary penalties against anyone.

Earlier the SEC could only seek penalties from administrative proceedings against people and entities that were registered with the SEC.  Administrative courts are generally considered more hostile towards defendants as they do not give protections offered by Federal Courts like the right to a jury trial.

In March, Gupta alleged that the SEC chose to bring administrative proceedings against him under the Dodd-Frank financial overhaul, for the bad faith purpose of shoring up a meritless case by disarming its adversary.

In July a US administrative law judge delayed Gupta's administrative proceedings, which was scheduled for July 18, for six months after federal prosecutors filed motions to intervene Reuters reports.

Judge Rakoff has ordered an expedited the treatment of Gupta's lawsuit with a hearing on evidence within four months.

Reuters reports that during the Rajaratnam trial, prosecutors played secretly recorded phone calls to show Gupta's alleged tips. Rajaratnam was found guilty of 14 criminal counts of conspiracy and securities fraud on May 11.

Rajaratnam is expected to be sentenced in the criminal case on Sept. 27. He also faces SEC civil charges.