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NEW YORK — A former Goldman Sachs and Procter & Gamble board member convicted of insider trading charges can remain free on bail pending the appeal of his insider trading conviction, a federal appellate panel said Tuesday.

Rajat Gupta, surrounded by family members including his four daughters, watched the arguments before leaving the Manhattan courthouse visibly pleased, breaking into a smile as a cameraman positioned himself before him. He was sentenced to two years in prison and fined $5 million in October.

The two-judge panel of the 2nd U.S. Circuit Court of Appeals didn’t immediately explain its reasoning for allowing Gupta to be freed on $10 million bail. A lower court judge previously had said he must begin serving his sentence before the appeal is heard.

Circuit Judge Jose A. Cabranes told lawyers for Gupta and the government to be ready to file written arguments within 45 days, indicating the court will hear the appeal on an expedited schedule.

From wire dispatches and staff reports