Paul, Weiss, acting on behalf of The Citco Group Limited and three Citco affiliates, secured summary judgment on all remaining claims brought against Citco in a case pending in federal court in Baton Rouge, Louisiana. The judge’s decision came two weeks prior to the start of trial.
Citco, the world’s largest hedge fund administrator, had served as the administrator to a hedge fund managed by Alphonse “Buddy” Fletcher Jr. Plaintiffs, three Louisiana-based pension funds, invested $100 million in the hedge fund in 2008. Following the financial crisis, Fletcher’s fund collapsed and plaintiffs were unable to redeem their investment. In 2013, they filed suit in Louisiana against Fletcher, a number of Citco entities, their investment advisor, and a handful of other individuals, alleging that the Citco defendants knew, and failed to disclose, material information about their investment prior to, and during, their investment.
Citco moved for summary judgment on four remaining claims: statutory violations of Louisiana’s Blue Sky Law; a holder claim; a negligent misrepresentation claim; and a third-party beneficiary breach of contract claim. On January 9, 2019, Chief Judge Shelly Dick granted summary judgment on the securities claims, holding that Citco and its affiliates had established they were neither the “sellers” of the relevant securities nor the “control person” of the seller, and thus could not be liable for any of the alleged omissions. Five days later, and a day before the final pretrial conference, the judge granted summary judgment on all remaining claims, largely on statute of limitations grounds. The judge held that Citco had marshalled extensive evidence showing that plaintiffs should have been on notice of their claim and that, aside from conclusory statements, they had failed to refute this showing. The judge also found that plaintiffs had not established that they were third-party beneficiaries of the relevant contract between the Citco entity that served as administrator and the fund.
The Paul, Weiss team included litigation partners Andrew Gordon (Picture), Gregory Laufer and Julia Wood and counsel Robert Kravitz.
Involved fees earner: Andrew Gordon – Paul Weiss Rifkind Wharton & Garrison; Robert Kravitz – Paul Weiss Rifkind Wharton & Garrison; Gregory Laufer – Paul Weiss Rifkind Wharton & Garrison; Julia Tarver-Mason Wood – Paul Weiss Rifkind Wharton & Garrison;
Law Firms: Paul Weiss Rifkind Wharton & Garrison;
Clients: Citco Group Limited;