Lawsuits

  • M&A, News

    CVR Energy Shareholders Surprised To Find Carl Icahn Acting Like A Corporate Raider

    If you want to buy a company you can do it in one of two […]

    / Jun 7, 2012 at 12:51 PM
  • News

    Donald Trump Offers How-To-Guide Re: Dealing With Disgruntled Employees Turned Whistleblowers

    Got an unhappy employee (or former employee) on your hands who’s decided to channel his or her anger by penning an Op-Ed in a major publication detailing egregious acts being committed at your firm and/or going to the Feds with allegations of fraud? Not sure how to handle the fallout? Why not take a page from Donald Trump’s playabook? He found himself in a similar situation with regard to Sheena Monnin, a first-year Miss Pennsylvania who “resigned her crown” over the weekend, claiming that the Miss USA pageant is “rigged.” Here’s how Don dealt with the matter and how anyone thinking about taking a more hands-on approach to dealing with disgruntled employees might too:

    Threaten to sue.

    “We’re going to bring a lawsuit against this girl,” Trump, who co-owns the Miss Universe Organization with NBCUniversal, told NBC’s “Today” show co-anchor Ann Curry on a phone interview; he used similar language in a phoner with George Stephanopoulos on ABC’s “Good Morning America.”

    Note that you’ve already conducted a thorough investigation into the employee’s claims and that your internal probe has revealed them to be baseless.

    Monnin announced Tuesday on her Facebook page she was turning in her tiara after she: “Witnessed another contestant who said she saw the list of the Top 5 BEFORE THE SHOW EVER STARTED proceed to call out in order who the Top 5 were before they were announced on stage. Apparently the morning of June 3rd she saw a folder lying open to a page that said ‘FINAL SHOW Telecast, June 3, 2012′ and she saw the places for Top 5 already filled in.” “They’ve done an investigation,” Trump said today. “I just found out about it — they just reported to me about five minutes ago. The person that supposedly showed the list totally denies that that ever took place.”

    Suggest, by saying outright, that the outburst can chalked up to the fact that this person didn’t receive the promotion she thought she deserved. Make it clear that she was not partner material. Sixth-year VP material at best.

    Asked his first impression of Monnin, Trump said, “I saw her there. My impressions were she didn’t have a chance of being in the Top 15 — not even close. And all this is, is a girl who went there, lost, wasn’t in the 15, and she’s angry at the pageant system. Later, he added, “I never felt she had a chance. And all this is is buyer’s remorse.”

    Donald Trump says he’ll sue ex-Miss Pennsylvania over her claims of Miss USA fraud [WaPo]

    / Jun 6, 2012 at 3:08 PM
  • News

    Number Of People Suing Facebook Approaching Number Of People On Facebook

    It did not take long for plaintiffs’ lawyers to realize that there was good money […]

    / May 23, 2012 at 4:30 PM
  • News

    Former S&P Analyst Has Some Things He’d Like To Get Off His Chest

    Yesterday we talked a bit about this lawsuit bubbling around where some investors are suing […]

    / May 9, 2012 at 5:15 PM
  • News

    Ratings Agencies Can Be Sued As Long As They Lie To Few Enough People

    One thing that looks pretty certain is that lawsuits over crisis-era structured credit products will […]

    / May 8, 2012 at 5:30 PM
  • News

    JPMorgan (Et Al) Sued By Occupy Wall Street

    Four New York City Council members sued the city today over the handling of Occupy […]

    / Apr 30, 2012 at 1:27 PM
  • News

    Highland Capital Management Founder Sees Your Hiding Of Assets And Raises You A Megalomaniacal Prick

    As some of you may recall, back in March, Highland Capital Management founder and CEO James Dondero testified that he is “insolvent under Texas family law, if not according to normal accounting rules,” despite a 2010 tax return showing his adjusted gross income that year to be in excess of $36 million. The reason his finances were in question was because Dondero filed for divorce in September, and how much he owes his wife Becky is currently in dispute. Becky is “seeking enforcement of a prenuptial agreement guaranteeing her half of the couple’s community property, capped at $5 million,” plus “spousal support and interim attorney fees.” James, perhaps you can glean, is hoping it will be less than that and perhaps even nothing. One thing that really didn’t help?

    Patrick Daugherty, a former senior portfolio manager at Highland who quit in October, testified that he met with James Dondero for drinks last month. “He told me his plan was to get his net worth down and pay her as little as possible,” said Daugherty, who was called to the stand by Becky Dondero.

    That testimony was given on March 28th. On April 11, this happened:

    Highland Capital Management, the $20 billion hedge fund and private equity firm based in Dallas, has launched a lawsuit that calls its former private equity investing chief a “megalomaniacal” manager who engaged in “abusive tirades” that “dehumanized employees.” Patrick Daugherty is the former head of stressed special situations and private equity at Highland Capital Management, where he was responsible for $8 billion of assets until he resigned in September 2011. Known as a blunt-speaking Texan, Daugherty has served on the board of Metro-Goldwyn-Mayer and as chairman of companies like Cornerstone Health Group.

    According to a 14-page complaint Highland filed in Texas state court in Dallas earlier in April, Daugherty has been paid in excess of $26 million while at the firm, but voluntarily resigned after “Highland refused to accede to his unacceptable ultimatums and megalomaniacal demands regarding compensation.” The lawsuit claims that Daugherty was “belligerent to peers” and that Highland employees complained and even quit after Daugherty publicly berated them as “‘f—ing idiots’” and disparaged them using other vulgarities. Highland, which has a reputation in the investment community for using hard-hitting tactics, pulls no punches in a lawsuit that at times can appear cruel. It claims that Daugherty’s tenure at Highland was characterized by extreme behavior and his performance diminished over the years as he “became increasingly unmanageable, erratic, and insubordinate.”

    It didn’t have to be this way, Patrick!

    $20 Billion Highland Capital Calls Former Private Equity Chief “Megalomaniacal” [Forbes]

    / Apr 27, 2012 at 4:09 PM
  • News

    Things AIG Employees Say: “Make sure you grab a bite to eat before this one does! He’s been known to clean out a Danish platter!”

    What were AIG employees doing in April 2008? Carelessly writing CDS on enormous quantities of mortgage-backed securities and (allegedly) laying the groundwork for being sued over “racist [and sizeist?] taunts,” apparently.

    An obese black lawyer filed a federal lawsuit yesterday against insurance giant AIG and an ex-supervisor, saying his white boss yelled out “Hey! Hey! Hey! It’s Fat Albert!” and other racist taunts. Earl Brown, 43, an Ivy league-educated lawyer, claimed in the civil-rights suit that the ex-boss, John Hornbostel, 49, peppered him with racist remarks and cruel jokes about his weight for years before he was canned without cause. “Make sure you grab a bite to eat before this one does! He’s been known to clean out a Danish platter,” Hornbostel yelled about Brown during a meeting in April 2008, the suit claims. Hornbostel then allegedly walked away humming the tune to the “Fat Albert and the Cosby Kids” animated TV show.

    Hornbostel seems to have ended up at a hedge fund post-AIG. It’s unclear if he’s tried out any new material on his new colleagues.

    Obese lawyer sues supervisor and AIG for ‘Fat Albert’ insults [NYP via ATL]

    / Apr 26, 2012 at 3:47 PM
  • News

    American Apparel CEO: Numerous Lawsuits Against Me Are A Testament To My Awesomeness

    Has the profitability of your company come into question of late? Have you been sued many, many times, typically for sexual harassment? Want to set the record straight but are unsure of what to say? Perhaps Dov Charney can help. In an interview with CNBC today, Charney told Jane Wells that any suggestion that American Apparel can’t turn a profit on its mesh unitards, gold lamé leggings, and fishnet bodysuits is totally off based. “I think you’re casting [the business] in the wrong light to say it’s unprofitable,” Charney said. “From accounting perspective, from 20 feet up, yeah, it’s unprofitable. But if you get down to the numbers…we’re getting our groove back.” There was also this exchange.

    Wells: I’ve counted, what is it, nine lawsuits against you? That’s  a lot.

    Charney: Yeah. It’s also a testimony to my success.

    Wells: Do you think you’re inappropriate at all?

    Charney: No.

    Wells: The range of criticism is everything from sexual predator to just…weird.

    Charney: Well, you know, I mean, weird? I like weird…Many of the great entrepreneurs of the last century have been criticized for being somewhat different.

    Wells: Do you see yourself as a Steve Jobs meets Hugh Hefner type?

    Charney: That wouldn’t be for me to say.

    American Apparel CEO: Tattered But Not Torn [CNBC]

    / Apr 10, 2012 at 6:38 PM
  • sergio ermotti

    Banks

    Court Finds That UBS Exploited Clients And Tricked Them Into Overpaying For Toxic Securities, But In A Legal Way

    This is kind of exciting: a bank won a CDO case! Or: something nice happened […]

    / Mar 28, 2012 at 12:35 PM
  • News

    Jimmy Cayne May Be About To Come Into Some Money!

    10-pound bag of Chronic Supernova, consider yourself bought.

    Thousands of former Bear Stearns Cos. (BSC) employees will share a $10 million settlement of lawsuits claiming they lost money on the bank’s stock in their retirement accounts. Two ex-Bear Stearns employees yesterday asked a federal court judge in Manhattan to approve the settlement on behalf of an estimated 8,400 former colleagues. The settlement will resolve class-action suits filed beginning in 2008 against Bear Stearns and other defendants by former employees of the bank. The employees, participants and beneficiaries of Bear Stearns’s employee stock ownership plan who held shares of the bank’s common stock, claimed risky investments in subprime mortgages caused them to lose money.

    Ex-Bear Stearns Employees to Get $10 Million in Settlement [Bloomberg]
    Related: Jimmy Cayne Takes “It’s A Bag Of Oregano” Route In Face Of Drug Use Allegations

    / Mar 21, 2012 at 4:05 PM
  • jed-rakoff-21

    News

    Appellate Court Willing to Entertain the Possibility that Citi Was Not Committing Fraud

    I’ve had some fun these last few days proposing counterintuitive theories for why Citi might not suck as much as you probably think it does and it’s nice to see others joining in the pastime, even if this sounds a little far-fetched:

    The district court’s logic appears to overlook the possibilities (i) that Citigroup might well not consent to settle on a basis that requires it to admit liability, (ii) that the S.E.C. might fail to win a judgment at trial, and (iii) that Citigroup perhaps did not mislead investors.

    That piece of rank conjecture is from the Second Circuit’s opinion on an appeal* of Judge Rakoff’s rejection of the settlement between the SEC and Citi over some mortgage-backed securities. Here’s DealBook:

    / Mar 15, 2012 at 7:27 PM
  • M&A, News

    Delaware Judge Driven To Possibly Obscene Energy Industry Euphemism By Kinder-El Paso Merger

    Delaware Chancellor Leo Strine has a bright future in blogging if chancelling doesn’t work out for him. Here’s how he describes Kinder Morgan’s negotiations to buy El Paso, specifically KMI CEO Rich Kinder’s price retrade with EP CEO Doug Foshee:

    Kinder said “oops, we made a mistake. We relied on a bullish set of analyst projections in order to make our bid. Our bad. Although we were tough enough to threaten going hostile, we just can’t stand by our bid.”

    Instead of telling Kinder where to put his drilling equipment, Foshee backed down.

    I umm … I’m pretty sure that that quote from Kinder is approximate.

    Anyway, this is from Strine’s opinion refusing to block the KMI-EP merger from proceeding even though he is pretty pissed about some of the apparent conflicts of interest in the deal, including that Goldman Sachs owns almost 20% of KMI while also advising EP, that the lead GS banker owned some KMI stock that he didn’t disclose, and that Foshee negotiated the merger single-handed while also maybe thinking about possibly LBOing EP’s E&P business for his own self.

    Lucrative though my current pseudoprofession is, I suspect that if Strine ever leaves the chancelling racket he’d probably prefer to try his hand at merging and/or acquiring. Certainly he is fond of dispensing tactical advice:

    / Mar 1, 2012 at 6:47 PM
  • georgesorosgirlfriend

    News

    Does George Soros Really Want The Ex-Girlfriend Who He Promised An Apartment To Go Away?

    Remember Adriana Ferreyr? To recap, she’s a woman with whom George Soros either conducted “a […]

    / Feb 28, 2012 at 3:24 PM
  • john paulson

    Hedge Funds

    Former Paulson And Co Investor Isn’t Buying The “Oops, I Invested In A Horrible Stock” Act

    Remember the Paulson & Co Sino-Forest investment? Turned out to be one of the fund’s […]

    / Feb 21, 2012 at 12:56 PM
  • saccapitalfleece

    News

    Ex-Mrs. SAC Capital Isn’t Finished Here

    The U.S. Court of Appeals for the Second Circuit will hear oral arguments at 10 […]

    / Feb 21, 2012 at 11:57 AM
  • Banks, News

    The Mortgage Settlement Is Fine

    When people who hate banks and love homeowners are full of wild rage about this […]

    / Feb 9, 2012 at 5:13 PM
  • News

    Maybe The SEC Decided To Throw A Trial So It Can Go Back To Settling Everything

    I try to be honest when telling you that a court complaint or SEC filing […]

    / Dec 16, 2011 at 5:42 PM
  • News

    Don’t Even Entertain The Thought Of Serving Jon Corzine With A Lawsuit While He’s On His Break

    As you may have heard, today is Jon Corzine’s third day testifying in Washington about […]

    / Dec 15, 2011 at 3:28 PM
  • News

    And Now, Blech, Mortgage Lawsuits

    It’s difficult to keep track of all the things that all the people are suing […]

    / Dec 2, 2011 at 2:55 PM
  • News

    Surely The SEC Is Sick Of Going To Court By Now?

    A lot of legal issues look like substantive things but are actually things about what […]

    / Nov 28, 2011 at 3:11 PM
  • News

    Hank Greenberg Wants To Know Why His Bailout Was So Much Crappier Than Everyone Else’s

    The complaint in Hank Greenberg’s lawsuit against America is now online, and strange and entertaining […]

    / Nov 21, 2011 at 4:26 PM
  • News

    Hank Greenberg Estimates If The Government Had Minded Its Own Damn Business Back In ’08, AIG Would’ve Been At Least $25 Billion Ahead Right Now

    Remember September 2008? Remember how American International Group was doing in September 2008? Kind of […]

    / Nov 21, 2011 at 11:47 AM
  • News

    MF Global Employees Not Going Down Without A Fight

    They see your firing and raise you a $25 million lawsuit.

    / Nov 14, 2011 at 4:30 PM
  • News

    Hedge Fund Founder Sued For Telling Employees How He Really Feels

    One of the most difficult and important part of being a hedge fund manger is […]

    / Nov 7, 2011 at 10:23 AM
  • News

    If He Could Turn Back Time…If He Could Find A Way

    In 2003, things were going pretty well for Todd J. Remis. Great, even. The equity […]

    / Nov 3, 2011 at 2:09 PM
  • News

    Federal Judge Wants To Know Why SEC Is Only Charging Citi 1/5th As Much As It Charged Goldman For Ripping Off CDO Investors

    If the SEC really wanted to reduce the chances of embarrassing itself, besides better Internet […]

    / Oct 27, 2011 at 6:28 PM
  • M&A, News

    Delaware Judge To Goldman: Here, Let Me Re-Do That Fairness Opinion For You

    A thing I liked about being a banker, but that made me consistently terrible at […]

    / Oct 17, 2011 at 6:10 PM