SAC Says Suing Insurer Met With Cohen Ex Prior To Insider-Trading Lawsuit

May 17 2011 | 1:58am ET

SAC Capital Advisors has alleged that a legal nemesis may have been behind the explosive racketeering lawsuit filed against founder Steven Cohen last year.

The Stamford, Conn.-based hedge fund giant in a March court filing alleged that Patricia Cohen met with lawyers for Canadian insurer Fairfax Financial Holdings, which has accused SAC and other hedge funds of insider-trading and conspiring to drive down its share price. Fairfax is seeking some $6 billion from those firms, which also include Third Point and Kynikos Associates.

In her lawsuit, which originally sought at least $100 million and “a substantial, if not controlling stake” in SAC, Patricia Cohen accused her ex-husband of hiding assets from her and the court during their 1990 divorce. She also used the opportunity to accuse the SAC founder of insider-trading, allegations that Cohen’s lawyers dismissed as an extortion attempt.

Patricia Cohen’s lawsuit was thrown out of court in March. But that lawsuit may not have been entirely her own doing, the hedge fund says.

“SAC has learned from reliable sources that Patricia Cohen in fact met with counsel for Fairfax prior to filing that lawsuit,” SAC said in the March 2 filing, unsealed last week. The hedge fund asked for permission to depose both Patricia Cohen and a Fairfax representative; both of those requests were denied by court-appointed discovery master Stephen Orlofsky. SAC is appealing his decision.

“Neither Fairfax nor its lawyers had anything to do with Patricia Cohen’s lawsuit, and only learned about it from news reports,” Michael Bowe, Fairfax’s lawyer, told Bloomberg News. “Suggestions otherwise sound paranoid.”


In Depth

Fitch Says Alternative Asset Managers 'Stable' Despite Dry Powder

Nov 20 2014 | 9:30am ET

Ratings agency Fitch says the outlook for seven publicly traded alternative asset...

Lifestyle

Cohen Buys $101 Million Sculpture

Nov 12 2014 | 9:17am ET

Steven Cohen was the sole bidder for a rare Alberto Giacometti sculpture at Sotheby...

Guest Contributor

Why The Big Money Is Going To Europe

Nov 14 2014 | 6:03am ET

Peer-to-peer lending was invented with the individual investor in mind. But despite...

 

Sponsored Content

    For Hedge Funds, Mastering Data Is Key To Success

    Nov 4 2014 | 9:45am ET

    Data management is important to every business, but for hedge funds, it is critical. FINalternatives recently asked Peter Sanchez, CEO of Northern Trust Hedge Fund Services, how fund managers can deal with the demands of managing data while at the same time remain transparent and abide by operational best practices. Read more…

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

November 2014 Cover

Building a better market

Reg NMS created a huge bifurcation in equity markets and while much of what has followed has been positive, in terms of lower fees and greater liquidity, many traders would like to see the market come...

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.