Monday, 20 October 2014
Last updated 3 hours ago
Apr 3 2013 | 11:55am ET
A federal judge has dismissed a lawsuit accusing Paulson & Co. of due-diligence failures in its investment in a Chinese timber company, one that cost the hedge fund's investors almost $600 million.
U.S. District Court Judge Marcia Cooke in Miami threw out the would-be class-action, ruling that the plaintiff lacked standing because his investment with Paulson was through a Citigroup feeder fund, meaning Paulson had no fiduciary duty towards him. The judge said a complete, written order would follow, but dismissed the case "without leave to amend."
The plaintiff, Hugh Culverhouse, a former federal prosecutor and the son of the former owner of the National Football League's Tampa Bay Buccaneers, accused Paulson of "gross negligence" and "shocking disregard for the financial well-being of its investors" in buying up 12.5% of Sino-Forest Corp. That company's shares plummeted in 2011 when another hedge fund accused it of overstating its timberland holdings in China.
Paulson told investors that it booked a C$105 million loss over the life of its Sino-Forest investment.
"We are pleased with the judge's ruling," Paulson spokeswoman Dawn Dover said. "We have stated from the outset that this suit was completely without merit and that there was no basis in law or fact for the action."
Culverhouse told The Wall Street Journal that it was not fair that he was barred from suing Paulson simply because he hadn't invested with the firm directly.
Sep 22 2014 | 4:15pm ET
"I tell people that everybody likes good news and so if you have good performance that’s wonderful,” explains Mike McKitish of Peddie School's endowment, “but it’s the people that want to talk about the bad news or where they drifted and how they came back and how they stayed to their discipline…” that he wants to hear from. Read more…
Sep 30 2014 | 9:29am ET
The crisp Autumnal days of October are upon us, and so are a few of the hedge fund industry’s favorite charitable events. If you have never been to Rocktoberfest, well, you are missing out. And for a quieter evening of sipping and socializing, stop by HFC’s Wine Soiree. Read more…
Most traders agree that proper risk management is the key to successful trading. However, many traders depend on the deeply flawed measure of standard deviation as a benchmark of risk. Here we put it ...