Wednesday, 25 November 2015
Last updated 54 min ago
Feb 21 2012 | 1:28am ET
Add a possible class-action lawsuit to Harbinger Capital Management's growing list of woes.
At the end of a week that saw federal regulators pull the plug on the New York-based hedge fund's ambitious and controversial wireless Internet venture, an investor accused the firm of misleading her and other clients about the size and risks of Harbinger's investment in the company, LightSquared.
Lili Schad, who invested $4 million with the hedge fund, is seeking class-action status for her complaint, filed on Friday in Manhattan federal court. In addition to taking issue with Harbinger's investment of more than 60% of its assets in LightSquared and its failure to warn investors of potential regulatory hurdles, Schad's lawsuit also reprises an allegation—currently the subject of a federal investigation—that Harbinger gave preferential redemption terms to some "favored investors," among them Goldman Sachs.
"Had plaintiff known that defendants would concentrate the fund's investments in LightSquared or known of the regulator obstacles the company faces, she would have refrained from investing in the fund or immediately sought to withdraw her investment from the fund," the complaint said.
The Federal Communications Commission last week said it would block the rollout of LightSquared's planned network, citing tests showing that it interferes with global positioning systems. Harbinger and LightSquared dispute those findings and pledged to continue to work towards a solution.
Oct 21 2015 | 10:41am ET
One of the most unique charity benefits in the hedge fund industry, A Leg To Stand On's (ALTSO's) Hedge Fund Rocktoberfest - NYC, raised nearly $500,000 last Thursday thanks to the generous support of major sponsors and nearly 1,400 attendees from the Tri-State finance, business and hedge fund communities. Read more…