Highland Lawsuit Called ‘Transparent End-Run’

Aug 12 2010 | 12:01pm ET

Last month, Highland Capital Management sued UBS and one of its investment banking clients, alleging that it was kept out of LyondellBasell Industries’ bankruptcy-exit financing because of another legal spat between the hedge fund and UBS. Now, the investment bank and Lyondell are seeking to have Highland’s lawsuit against them junked, as UBS’s lawsuit against Highland over a bad collateralized debt obligation deal was six months ago (UBS has since refiled the lawsuit).

According to Lyondell’s motion to dismiss the Highland lawsuit, Highland’s lawsuit came too late—its bankruptcy plan was signed off on in April, a month after the hedge fund learned that it was being excluded from the financing. Lyondell called Highland’s bid to halt its bankruptcy plan a “transparent attempt to end-run around” the plan.

“Not only did Highland fail to raise its accusations at any number of stages during the bankruptcy process, but Highland never even contacted that reorganized debtors to lodge a complaint about conduct it now alleges caused substantial damages,” Lyondell wrote. What’s more, some Highland funds actually voted in favor of the plan that excluded them the company alleges.

Finally, Lyondell told the New York federal bankruptcy court, Highland picked the wrong venue and should have filed its complaint in federal court rather than New York state court.

In its lawsuit, Highland said that “UBS brazenly admitted that it refused to provide any allocation to Highland because of the UBS/Highland litigation.”


In Depth

Q&A: Executive Recruiter Talks Hedge Fund Closures, Hiring Trends

Dec 19 2014 | 6:58am ET

This year, hedge funds have been closing at a rate not seen since the financial...

Lifestyle

Cooper-Hohn Won't Contest Divorce Settlement

Dec 18 2014 | 9:51am ET

The ex-wife of hedge fund billionaire Christopher Hohn will not contest a divorce...

Guest Contributor

Alternative Investment Funds Face A Communications Imperative

Dec 19 2014 | 6:10am ET

A handful of the top alternative investment firms on both sides of the Atlantic...

 

Sponsored Content

Editor's Note

    Guidelines for Guest Articles

    Oct 22 2014 | 9:46am ET

    We are always looking for guest articles from hedge fund managers and buy-side firms.

    If you are interested in submitting a contributed piece for possible publication on FINalternatives, please take a look at the specs. Read more…

 

Futures Magazine

December 2014 Cover

Futures 2014 person of the year

Jeff Sprecher was simply looking for a platform to trade energies when launching ICE 14 years ago but it has grown to reach the pinnacle of both the listed futures and equities world.

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.