Thursday, 31 July 2014
Last updated 1 hour ago
Apr 9 2007 | 3:19pm ET
The old adage teaches that once the genie is out of his bottle, you can’t get him back in. But that isn’t stopping one new hedge fund—one with a particularly notorious lineage—from doing its very best with a barrage of lawsuits and threats. Alas, unfortunately for Solengo Capital, the old adage seems to hold true.
Solengo, the new home of former Amaranth Advisors trader Brian Hunter, who holds the distinction of being the only person in hedge fund history to single-handedly lose more than $6 billion dollars, has been waging a campaign against news outlets and blogs to keep its relatively benign marketing material out of the public’s hands. But it isn’t working, because the PDF file now resides on countless computers whose users Solengo can’t sue. And so, the game of legal whack-a-mole continues.
The latest Web site to host what blogger Greg Newton—the first to post the document, on his Naked Shorts blog—calls Solengo’s “shame-free” marketing material can now be found here (or at least it could be at the time this story was posted).
In the two weeks since Newton first posted the document (and then took it down under pressure from Solengo’s lawyers), the brochure has appeared here on FINalternatives and the blogs Dealbreaker and FT Alphaville. All have since taken it down, and Dealbreaker has been slapped with a lawsuit.
An unidentified individual posted the PDF on an Angelfire homepage over the weekend, but, after what we can only assume was a phone call from Solengo’s lawyers, Angelfire decided the file violated its terms of service and put the kibosh on it.
“I think it is valuable for the public to see what hedge funds are doing,” John Carney, Dealbreaker editor and newly-minted defendant, said. “At a time when hedge funds are under threat of government regulation, being more shadowy and secretive is ill-advised.”
Carney declined to comment specifically on the lawsuit the hedge fund brought against him and the publishers of the blog he edits. However, a copy of Solengo v. Dealbreaker—in which the plaintiff claims that the brochure is protected by copyright and contains trade secrets—can be found here on Naked Shorts.
Why Solengo has gone to such lengths to stop the dissemination of what was obviously made as a marketing brochure is unclear. Industry observers have noted that the firm might well be thrilled that the brochure is getting such wide circulation, since hedge funds are banned from most mainstream marketing techniques. Some posit that the threats were Solengo’s way of demonstrating good faith to regulatory authorities, who do not take kindly to hedge funds that market through the press.
But the continuing fervor emanating from Solengo headquarters in New York and Calgary, Alberta, throws fresh doubt on Solengo’s motives. Could it be that Solengo really doesn’t want anyone to see its brochure?
Solengo is, after all, the first-ever hedge fund run by someone who lost $6 billion in the blink of an eye.
Jul 8 2014 | 10:48am ET
The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…