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Post by unlawflcombatnt on Sept 1, 2007 4:24:56 GMT -6
It appears Bear Stearns 2 bankrupt hedge funds will not be allowed the extra protections afforded by filing bankruptcy in the Cayman Islands, instead of the United States. (from Bloomberg) Bear Stearns Judge Rejects Ban on Hedge Fund Suits By Tiffany Kary " A federal judge refused to grant permanent protection from U.S. lawsuits for Bear Stearns Cos.' two bankrupt hedge funds, finding the Cayman Islands was not the proper principal jurisdiction for them to liquidate assets.
U.S. Bankruptcy Judge Burton Lifland in New York today said the funds weren't eligible for permanent protection from the suits under a provision of the federal bankruptcy law designed to assist foreign companies liquidating overseas. He granted a temporary ban on such suits, telling the bank it could file a different petition that might allow him to block such suits....
Earlier this week, Lifland had said that most of the funds' assets seemed to be in the U.S. not in the Caymans, where they had filed a petition to liquidate their assets.
The cases are Bear Stearns High-Grade Structured Credit Strategies Master Fund Ltd., 07-12383, and Bear Stearns High- Grade Structured Credit Strategies Enhanced Leverage Master Fund Ltd., 07-12384, U.S. Bankruptcy Court, Southern District of New York (Manhattan)."
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Post by jeffolie on Sept 1, 2007 13:35:55 GMT -6
American courts demanding jurisdiction of hedge fund bankruptcies will become more important at the end of this month as large numbers of hedge funds will be forced out of business at the end of September due to massive redemptions.
It will take years for the courts to end the appeals that will follow this decision.
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