A term of imprisonment for insider trader John Gay is the only appropriate sentence, crown prosecutor David Staehli SC, said in the Launceston Supreme Court today.
However, Mr Staehli said suspending the sentence may be justified and he would not push for the former Gunns chairman to see inside a jail cell.
Gay, 70, pleaded guilty to insider trading last week after selling more than 3 million shares in December 2009 while privy to price sensitive information.
Mr Staehli said Gay benefited to the tune of nearly $800,000 by the trade.
The court heard the shares were valued between 91 cents and 90 cents when Gay sold them in two lots.
When Gay's inside information was released to the market in February 2010 Gunns' share price dropped from 87.5 cents to 68.5 cents in one day.
Gay's defence counsel Neil Clelland SC said he took issue with the amount his client was said to have benefited by.
In his sentencing submission before Justice David Porter, Mr Clelland said Gay's illness at time was important background to his offending.
He said Gay decided to sell shares and reduce debt when diagnosed with prostate cancer in 2008 -- more than a year before he made the insider trade.
This made it an unusual case because the decision to commit insider trading usually occurs when or after the inside information is obtained.
In a medical report tendered to the court Gay's urologist said the defendant's hormone therapy for cancer may have led to ``decreased mental acuity''.
``(Which) may have contributed to his poor judgement,'' the statement said.
Mr Clelland will continue his submission this afternoon.