An employee of the now defunct Galleon Group told New York jury on Wednesday her boss Raj Rajaratnam and Rajat Gupta had in 2007 squabbled over a joint investment in a fund.
Gupta had wanted a higher rate of profit based on his investments from the fund, Voyager Capital Partners, which was managed by Rajaratnam's Galleon group.
Gupta’s lawyers have long contended that he lost $10 million because of this investment and he and Rajaratnam fell out over this dispute.
The prosecution has sought to establish a close relationship between the two to prove Gupta had passed on inside information to Rajaratnam.
Former Galleon employee Isvari Mahadeva, appearing as a state witness, said she was asked in 2007 to review an agreement about Voyager because of Gupta raising his stake in it.
When asked by assistant US attorney Richard Tarlowe how many disputes did she know of, she answered, "Just the one."
Rajaratnam was convicted in 2011 of insider trading and is serving a jail sentence of 11 years.
An FBI agent James Barnacle testified separately on Wednesday that Gupta had tipped Rajaratnam about a $5 billion investment in Goldman Sachs by Warren Buffet's Berkshire Hathaway.
Galleon made a profit of $840,000 by buying shares before the investment was announced. He promptly sold them after the announcement profiting from the spike in Goldman shares.