Ritchie Capital Bankruptcy Bid Dismissed

Apr 14 2008 | 10:37am ET

A pair of hedge funds cannot force a Ritchie Capital hedge fund into bankruptcy, a judge has ruled.

U.S. Bankruptcy Court Judge Susan Sonderby dismissed the involuntary bankruptcy action filed last year by Benchmark Plus Partners and Sterling Asset Management, which sought access to the records of the troubled Ritchie Low Volatility Fund, which sold off most of its assets last April after a disastrous life insurance deal with Coventry First.

“This is an expected but gratifying victory for all investors in the fund, and a vindication of our actions,” firm founder A.R. Thane Ritchie said.

“We won today because the facts were on our side,” Ritchie Capital’s lawyer, Tom Cauley, added. “As Judge Sonderby found, the fund is fully and timely meeting all of its financial obligations and Ritchie Capital has acted in good faith. Moreover, Ritchie Capital has gone above and beyond the usual standards for hedge funds in providing financial information to their investors.”

Ritchie plans to sue Benchmark Plus and Sterling for upwards of $5 million to recoup the expense of the legal action.

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