Tuesday, 29 July 2014
Last updated 4 hours ago
Oct 17 2007 | 7:53am ET
Huizenga Managers Fund has re-filed its fraud complaint against hedge fund Ritchie Capital Management, a month after an Illinois judge ridiculed its previous filing.
Oak Brook, Ill.-based Huizenga alleges it was “bamboozled” into investing more than $10 million in a $91 million Ritchie life-insurance fund. The strategy collapsed when Ritchie’s partner in the venture, Coventry First, was accused of fraud in last October.
According to Huizenga, which is run by Peter Huizenga, the brother of Miami Dolphins owner Wayne Huizenga, Lisle, Ill.-based Ritchie said it would invest in a range of strategies.
“No reasonable investor would invest in a fund with all of its assets in one security,” Huizenga says in its filing. Ritchie “knew that, if they truthfully disclosed the fund’s single security investment, potential investors would not invest in the fund, and outside investors such as Huizenga would pull out of the fund, demand the return of their investments, and/or sue them.”
Huizenga fears that its investment may be a total loss.
Ritchie CEO Thane Ritchie called the lawsuit “frivolous and baseless.”
“It is disingenuous for Huizenga to claim that ‘honesty and trust are fundamental’ to what they do when their amended complaint contains so many false allegations,” he said in a statement.
Its complaint, of course, had to be amended, because last month Judge Peter Flynn dismissed part of the lawsuit and demanded that it be re-filed before he’d consider it.
“The pleading here is really the functional equivalent of dumping a hay stack in the middle of the courtroom and saying, ‘Judge, find the needle,’” Flynn said at the time. “I am hopeful that we will see an amended complaint which focuses more carefully on the sometimes complex facts that are involved here.”
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…