Saturday, 27 August 2016
Last updated 7 hours ago
Jun 17 2014 | 8:59am ET
A hedge fund that invests in film and television productions has filed for bankruptcy as it seeks to collect money it says it is owed.
Aramid Entertainment Fund sought protection in federal bankruptcy court in New York. The fund, which is in the process of liquidating, has accused Fortress Investment Group of cutting it out of a film-financing deal with Sony Corp.
Aramid “has been embroiled in substantial and time-consuming litigation relating to some investments,” Kinetic Partners’ Geoffrey Varga, a consultant to the fund, told Bloomberg News. “The prosecution and defense of these actions has consumed a substantial portion of AEF’s liquidity and exposes it to potential liability.”
Aramid is seeking at least $44 million from Fortress, which it said reviewed its deal with Sony and Relativity Media in 2010 as part of a potential buyout. But Fortress never acted on that plan; according to Aramid, it used the information gleaned from the review to buy out Citigroup’s share of the deal, and then worked out a deal with Relativity to cut Aramid out, leaving it with nothing for its $22 million investment.
That case is set to go to trial in August.