Saturday, 26 July 2014
Last updated 20 hours ago
Mar 17 2014 | 3:44am ET
Fortress Investment Group has been sued by a collapsed Australian hotel- and investment management firm, whose liquidators say it was improperly raided by the alternative investments giant.
Octaviar’s liquidators allege that Fortress wrongly skimmed A$210 million from the company’s sale of its hotels arm, Stella, in 2008. According to the liquidators, that money should have gone to the company, formerly known as MFS.
“The defendants’ wrongful conduct resulted in Fortress grabbing the Stella sale proceeds before they could be remitted to OA at a time when OA was insolvent (or was rendered insolvent as a result of the defendants’ actions) and was unable to satisfy its obligations to creditors,” Katherine Barnet and William Fletcher allege.
The lawsuit, filed in New York state court, is actually the second filed against Fortress by Barnet and Fletcher. The liquidators previously sued the firm in Australia, but, as the new complaint notes, “the proverbial buck started and stopped with the defendants in New York.”
Barnet and Fletcher are seeking almost A$300 million from Fortress and three of its managing directors, Glenn Cummins, Constantine Dakolias and Marc Furstein. Two Fortress funds have also been named as defendants.
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…